HSA and FSA: Using Pre-Tax Dollars for Dental Care

At Sekhon Dental in Agoura Hills, we understand that quality dental care is an investment in your overall health and well-being. The good news? If you have a Health Savings Account (HSA) or Flexible Spending Account (FSA), you can significantly reduce your out-of-pocket dental costs by using pre-tax dollars for many of the services we offer.

Let’s explore how these tax-advantaged accounts work and how you can maximize their benefits for your dental care needs.

Understanding HSAs and FSAs: What’s the Difference?

While both HSAs and FSAs allow you to set aside pre-tax dollars for healthcare expenses, they function quite differently.

Health Savings Account (HSA)

An HSA is a personal savings account that you own, designed for those enrolled in high-deductible health plans (HDHPs). Think of it as a healthcare retirement account with unique tax advantages.

Key Features:

• Your money rolls over year after year – there’s no “use it or lose it” pressure
• Triple tax advantage: Contributions are tax-deductible, growth is tax-free, and withdrawals for qualified expenses are tax-free
• 2025 contribution limits: $4,300 for individuals, $8,550 for families
• Catch-up contributions: If you’re 55 or older, you can contribute an additional $1,000 annually
• Flexibility: You can change contribution amounts anytime, and even make prior-year contributions until April 15, 2026 for the 2025 tax year
• Portability: The account stays with you even if you change jobs or retire

Flexible Spending Account (FSA)

An FSA is an employer-sponsored benefit that must be elected during your company’s open enrollment period.

Key Features:

• 2025 contribution limit: $3,300 (increasing to $3,400 in 2026)
• Full amount available immediately – even though it’s deducted gradually from your paychecks throughout the year
• Use-it-or-lose-it rule applies – though many employers offer either a grace period (until March 15) or allow you to carry over up to $660 into the next year
• No high-deductible plan required – available to anyone whose employer offers it
• Important: You generally cannot have both a general-purpose FSA and an HSA, but you can pair an HSA with a Limited Purpose FSA (LP-FSA) that covers only dental and vision expenses

What Dental Expenses Are Eligible?

The IRS considers most medically necessary dental treatments as qualified expenses. Here’s what you can typically use your HSA or FSA funds for at Sekhon Dental – Dentist Agoura Hills:

Preventive Care

• Routine dental exams and cleanings
• X-rays
• Fluoride treatments
• Dental sealants

Restorative Procedures

• Fillings
• Crowns and caps
• Root canals
• Bridges
• Dentures (full or partial)
• Dental implants (when medically necessary)
• Tooth extractions

Specialized Treatments

• Periodontal (gum disease) treatment
• Orthodontics (braces and Invisalign when medically necessary, not purely cosmetic)
• Oral surgery
• Treatment for TMJ/TMD
• Sleep apnea appliances (when prescribed by a dentist)

Out-of-Pocket Costs

• Deductibles
• Co-payments
• Co-insurance amounts not covered by your dental insurance

What’s NOT Covered?

It’s important to understand what doesn’t qualify:

• Over-the-counter dental products like toothpaste, toothbrushes, floss, and mouthwash (unless prescribed by a dentist)
• Purely cosmetic procedures such as teeth whitening or veneers (unless there’s a documented medical necessity)
• Expenses already reimbursed by insurance or another source

The Power of Pre-Tax Savings

Let’s look at a real-world example of how much you can save:

Scenario: You need a crown that costs $1,200

If you pay with regular after-tax dollars (assuming a 30% combined federal and state tax rate):

• You need to earn $1,714 in pre-tax income
• After taxes, you have $1,200 to pay for the crown

If you pay with HSA or FSA dollars:

• You set aside $1,200 in pre-tax contributions
• You save approximately $514 in taxes

That’s real money back in your pocket simply by planning ahead.

Maximizing Your HSA or FSA for Dental Care

Here are strategic tips to get the most from these accounts:

Planning Your Contributions

1. Review your dental history – Look at what you’ve spent on dental care over the past few years
2. Anticipate upcoming needs – If you know you need major work (like implants or orthodontics), plan accordingly
3. Factor in your family’s needs – Children often need orthodontics, and aging parents may need implants or dentures
4. Don’t forget preventive care – Budget for your regular six-month cleanings and exams

Year-End Strategies

With year-end approaching, now is the perfect time to:

• Check your FSA balance – If you have funds that won’t roll over, schedule any needed dental treatments before year-end
• Schedule that postponed procedure – If you’ve been putting off dental work, using expiring FSA funds makes financial sense
• Book your family’s cleanings – Get everyone in for their preventive care visits
• Consider flexible timing at Sekhon Dental – Dentist Agoura Hills – We’re happy to help you maximize your benefits by scheduling treatments strategically

Smart Documentation Practices

To ensure smooth reimbursement:

• Keep all receipts from dental procedures, showing the date of service, description of treatment, and amount paid
• Request itemized statements from our office if needed for reimbursement
• Save explanation of benefits (EOB) from your dental insurance
• Obtain a letter of medical necessity from us for any procedures that might be questioned (like orthodontics or implants)
• Maintain organized records in case of an IRS audit

Using Your HSA or FSA at Sekhon Dental – Dentist Agoura Hills

We make it easy to use your tax-advantaged accounts:

1. Pay directly with your benefits card – Most HSA and FSA providers issue debit cards that work just like regular cards
2. Request reimbursement later – Pay out of pocket and submit receipts to your administrator for reimbursement
3. Split payments – Combine your HSA/FSA funds with insurance and other payment methods
4. Flexible payment plans – We offer additional financing options if your HSA/FSA funds don’t cover the full treatment cost

Special Considerations for 2026

Looking ahead to next year, contribution limits are increasing:

• HSA limits: $4,400 for individuals, $8,750 for families
• FSA limit: $3,400
• Dependent Care FSA: Increasing significantly to $7,500 per household (from $5,000) as part of recent legislation

If you’re planning open enrollment now (typically in November), keep these higher limits in mind when deciding your 2026 contributions.

Common Questions We Hear

Q: Can I use my HSA or FSA for my spouse and children?
Yes! Both accounts can be used for qualified expenses for you, your spouse, and your dependents.

Q: What if my dental insurance doesn’t cover something?
If the procedure is medically necessary and dental insurance won’t cover it, you can typically use your HSA or FSA funds to pay for it directly.

Q: Can I use HSA funds for cosmetic procedures?
Generally no, unless you can demonstrate medical necessity. For instance, veneers needed after an injury might qualify, but elective cosmetic whitening would not.

Q: What happens if I use HSA funds for a non-qualified expense?
You’ll pay income tax on the withdrawal, plus a 20% penalty if you’re under 65.

Take Action Before Year-End

As we approach the end of 2025, now is the perfect time to:

1. Log in and check your FSA balance – Don’t let those funds go to waste
2. Schedule a consultation at Sekhon Dental – Dentist Agoura Hills – Let’s discuss any treatments you’ve been considering
3. Book your family’s preventive care visits – Use those benefits before they expire
4. Plan your 2026 contributions – Think about next year’s dental needs during open enrollment

We’re Here to Help

At Sekhon Dental – Dentist Agoura Hills, we’re committed to making quality dental care accessible and affordable for Agoura Hills families. Our team is happy to:

• Provide detailed treatment estimates for your planning purposes
• Work with you to schedule treatments strategically around your HSA/FSA timelines
• Supply all necessary documentation for reimbursement
• Answer questions about what procedures might be eligible

Don’t leave money on the table. By understanding and utilizing your HSA or FSA benefits, you can invest in your smile while keeping more money in your pocket.

Ready to maximize your benefits? Contact Sekhon Dental – Dentist Agoura Hills today to schedule your appointment or discuss treatment options. We’re here to help you achieve optimal oral health while making the most of your pre-tax healthcare dollars.

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Please note: This article provides general information about HSAs and FSAs. For specific questions about your account eligibility and tax implications, consult your HSA/FSA administrator or a tax professional. The information about contribution limits and regulations is current as of 2025 but subject to change.