FSA money covers medical expenses your insurance doesn't fully pay for, but the IRS has strict rules about what counts
Your Flexible Spending Account (FSA) can pay for prescription drugs, copays, deductibles, and medical equipment — but not for groceries, gym memberships, or over-the-counter items without a prescription. The IRS publishes a list of what qualifies, and it's narrower than most people think. If you buy something that doesn't meet the rules, you'll owe taxes on that money plus a penalty.
The key distinction is whether the IRS considers something a medical expense. That means it has to treat, prevent, or diagnose a disease or condition. Vitamins for general health don't count. Vitamins prescribed by a doctor for a specific deficiency do. Sunscreen for daily use doesn't count. Sunscreen prescribed after skin cancer doesn't.
Key Takeaways
- Prescription medications, copays, coinsurance, and deductibles are always FSA-may be able to access, whether your insurance covers them or not.
- Over-the-counter drugs like pain relievers and allergy medicine require a prescription from your doctor to be FSA-may be able to access, even if you could buy them without one at a pharmacy.
- Medical equipment such as crutches, wheelchairs, hearing aids, and glucose monitors qualifies, but only if it treats a specific medical condition.
- Cosmetic procedures and products never may have access to, even if a doctor performs them, unless they are medically necessary to treat an injury or disease.
- Your FSA plan document may be stricter than IRS rules, so check with your plan administrator before spending on anything borderline.
Prescription medications and over-the-counter drugs with a prescription
Any prescription medication your doctor writes is FSA-may be able to access. This includes birth control, antidepressants, blood pressure medication, antibiotics, and inhalers. You pay with your FSA debit card at the pharmacy, or you submit a receipt for reimbursement.
Over-the-counter drugs are trickier. Aspirin, ibuprofen, allergy pills, and cold medicine are not FSA-may be able to access unless your doctor writes a prescription for them. A prescription doesn't mean the doctor has to dispense it — they can write "ibuprofen 200 mg" and you fill it at any pharmacy. Once you have that prescription, the drug becomes FSA-may be able to access even though you could buy the same product without one. Many people ask their doctor for a prescription specifically to use FSA funds.
Copays, coinsurance, and deductibles
Every time you pay a copay at a doctor's office or urgent care, that copay is FSA-may be able to access. Coinsurance — the percentage you pay after your deductible — also qualifies. Your deductible itself qualifies once you start paying it down.
This is one of the most straightforward uses of FSA money. You can pay these costs directly with your FSA debit card, or save your receipts and request reimbursement later. Many people use their FSA to cover the out-of-pocket costs that insurance doesn't pay for.
Medical equipment and supplies
Crutches, wheelchairs, walkers, canes, and braces are FSA-may be able to access. So are glucose monitors, test strips, lancets, and insulin. Hearing aids and batteries may have access to. Prescription eyeglasses and contact lenses may have access to. Dental work — fillings, crowns, root canals, orthodontia — qualifies if it's medically necessary (cosmetic dentistry does not).
The rule is that the equipment or supply must treat, prevent, or diagnose a medical condition. A blood pressure cuff you buy to monitor your hypertension qualifies. A fitness tracker you buy to monitor your general health does not, even if it measures heart rate. If you're unsure, ask your FSA plan administrator before you buy.
Mental health and therapy services
Copays and coinsurance for therapy, counseling, and psychiatric visits are FSA-may be able to access. If your insurance covers mental health treatment, your out-of-pocket costs for that treatment may have access to. This includes sessions with a licensed therapist, psychologist, or psychiatrist.
Medications prescribed for mental health conditions — antidepressants, anti-anxiety drugs, mood stabilizers — are also FSA-may be able to access. The same rule applies: if a doctor prescribes it to treat a medical condition, it qualifies.
What does not may have access to
Cosmetic procedures and products never may have access to, even if a doctor performs them. Botox, fillers, teeth whitening, and hair removal are not FSA-may be able to access. Cosmetic surgery is not FSA-may be able to access. The exception is if the procedure is medically necessary — for example, reconstructive surgery after an accident or burn.
General wellness items do not may have access to. Vitamins and supplements for overall health do not may have access to. Gym memberships and fitness classes do not may have access to, even if your doctor recommends exercise. Sunscreen for daily use does not may have access to. Toothpaste, mouthwash, and floss do not may have access to. Weight-loss programs and diet plans do not may have access to unless they are prescribed by a doctor to treat a specific medical condition like obesity-related diabetes.
Childcare, school tuition, and dependent care do not may have access to for an FSA (though they may may have access to for a Dependent Care FSA, which is a separate account). Over-the-counter medications without a prescription do not may have access to. Travel to medical appointments does not may have access to, though the medical appointment itself does.
How to know if something qualifies
The IRS maintains a Publication 502 that lists thousands of medical expenses. You can search it online, but the simplest approach is to ask yourself: does this treat, prevent, or diagnose a disease or condition? If the answer is no, it probably doesn't may have access to.
Your FSA plan administrator can also answer questions before you spend. Many plans have a customer service line you can call, and some have online tools to check may be able to access. It's worth asking rather than guessing — if you spend FSA money on something that doesn't may have access to, you'll owe income tax on that amount plus a 20% penalty when you file your taxes.
Keep all receipts and documentation. If the IRS audits your FSA spending, you'll need to show proof that the expense was medical and that you paid for it. A receipt from a pharmacy or doctor's office is your best evidence.
Frequently Asked Questions
Can I use FSA money for my spouse's or child's medical expenses?
Yes, as long as they are your legal dependent or spouse. You can use your FSA to pay for their prescriptions, copays, and medical equipment. The expense has to be for someone you claim on your taxes or someone you're legally responsible for.
Do I need a receipt to use my FSA debit card?
At a pharmacy or doctor's office, usually not — the system recognizes it as a medical transaction. At other retailers, you may need to provide a receipt or prescription to prove it's a medical expense. Keep receipts anyway in case your plan administrator asks for proof later.
What happens if I spend FSA money on something that doesn't may have access to?
You'll owe income tax on that amount when you file your taxes, plus a 20% penalty. For example, if you spend $100 on something ineligible and you're in the 22% tax bracket, you'll owe $22 in tax plus $20 in penalty — $42 total. It's worth checking before you spend.
Can I use FSA money for pet medical expenses?
No. Veterinary care and pet medications do not may have access to, even if the pet is a service animal. Service animals themselves may may have access to for certain expenses related to their training or equipment, but routine veterinary care does not.
Does FSA cover dental and vision care?
Yes, if it's medically necessary. Dental fillings, crowns, root canals, and orthodontia may have access to. Vision exams, prescription glasses, and contact lenses may have access to. Cosmetic dental work like teeth whitening does not. Check your specific plan, as some employers offer separate dental and vision FSAs with their own rules.