HCFSA Unsubstantiated Expenses

Did you know that the IRS requires substantiation for all health care flexible spending account (FSA) claims? Many providers and merchants are able to automatically substantiate purchases made with an FSA debit card, however that is not available for all FSA debit card purchases. Unsubstantiated expenses are treated as improper payments under the FSA and the employer must take certain steps to cure that deficiency. This Q&A explains those steps to offer a practical guide for employer correction of unsubstantiated payments.