What is an Employee Reimbursement Account (ERA)?
ERA is a voluntary pre-tax benefit plan that allows eligible employees to earmark part of their salary to pay for medical expenses through a Medical Expense Account. It also allows eligible employees to have pre-tax deductions in a separate account for dependent-care expenses. In addition, under the ERA program, certain benefit-plan premiums are automatically deducted on a pre-tax basis unless an employee waives having a pre-tax deduction. Examples of benefit plan premiums deducted as pre-tax are: health insurance, state group life insurance, excess dental, major medical, etc. What types of expenses are allowable from a Medical Expense Account? Allowable expenses include eyeglasses, contact lens and solutions, prescriptions, insurance co-payments and many over-the-counter drugs. What types of expenses are allowable from a Dependent Care Account? A Dependent Care Account allows for pre-tax deductions for dependent child, adult and elder care expenses to allow you and/or your spouse to w
Related Questions
- Can an employee / participant in a reimbursement account request a reimbursement that is greater than the balance in his account?
- Can I use the Employee Reimbursement Account program to pay for the dependent care of my domestic partner’s dependent child?
- What happens to funds contributed to a reimbursement account if an employee terminates employment?
