What is a Lifestyle Spending Account (LSA)?
A lifestyle spending (LSA) account is an employer-funded, pre-tax or post-tax spending account, with eligible expenses and plan details customized by the employer, that promotes healthy habits and overall well-being.
The amount in your LSA account can be used during the plan year set by your employer to pay for your qualified expenses and services.
What can an LSA be used for?
Generally, an LSA can be used for an employer’s choice of the following:
- Physical
- Athletic + exercise equipment
- Gym, health club, spa, and fitness studio memberships
- Fitness classes + lessons
- Personal trainer, fitness trackers
- Entry Fees (i.e., Marathon) + passes (i.e., Ski, golf)
- Nutritional Supplements
- Financial
- Home purchase expense reimbursement
- Financial advisor + planning services
- Financial seminars + classes
- Identity theft services
- Emotional/Other
- Non-medical counseling services
- Retreats (i.e., leadership, spiritual)
- Camping supplies
- Meditation + personal development classes (i.e., art, cooking)
- Annual park pass, hunting, and fishing licenses
Expenses which are used to supplement health insurance are not eligible.
How does an LSA work?
Promote healthy habits and overall well-being by creating a fully customizable, post-tax lifestyle spending account (LSA). Since the employer funds an LSA with post-tax dollars, the dollars a consumer spends is considered taxable income to employees.
An LSA is fully funded and customized by the employer which means there are no employee contributions. You can use the funds in your LSA throughout the plan year for qualified expenses.
Why choose an LSA?
Build it your way! Lifestyle spending accounts are being used by employers to better attract and retain employees.
It is common for employers to consider eligible expenses that range from physical wellness (gym memberships, exercise equipment, etc.), financial wellness (student loan reimbursement, financial adviser costs, etc.), emotional wellness (meditation classes, counseling services, etc.) and other expenses that could improve employee wellbeing (pet care, camping equipment, etc.).
What can an employer customize?
- How much they would like to contribute
- When contributions are available for consumers to use
- Which employees they contribute to
- What expenses are eligible
- How funds are handled at the end of each plan year (Run out, rollover, etc.)
- How funds are handled for terminated employees (Run out period)
If you have any specific questions about how an LSA can benefit you or what types of expenses are qualified under LSA, contact us!
We would love to help you!
Email: sales@consolidatedadmin.com
Call us between 8:00am and 5:00pm Monday through Friday: +1 (877) 941-5956
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