Can I Use My HSA or FSA to Buy A Medical Wig?
The short answer is, yes. But if you have your own insurance, it’s not necessary to compare HSA or FSA to buy a wig. This is because you are only eligible for a Health Savings Account (HSA). Conversely, your employer can offer other types of medical expense accounts. Sometimes they even offer employees multiple ones at the same time.
We know that with all of the many acronyms, people are often confused as to which health care card covers specific expenses. Generally speaking, sometimes paying for health care can be complicated. Particularly if you’re on a tight budget or have a unique medical condition like cancer or undergoing chemotherapy treatments.
Given these points, here are the differences between a healthcare HSA and FSA health care accounts.
Health Savings Account (HSA)
You can set aside pre-tax money to pay for qualified medical expenses with an HSA. Wigs are eligible for reimbursement with health savings accounts (HSA) with a Letter of Medical Necessity. But they are not eligible for reimbursement with dependent care flexible spending accounts.
Wigs can be worn to cover baldness and is a less expensive alternative to medical therapies for restoring your hair. For this reason, the IRS has deemed wigs used for this purpose as a medical expense which you can show on your tax returns. As such, medical wigs are eligible for reimbursement if you paid for it using your HSA.
Of course, your wig must have been purchased upon the advice of a medical professional in order to qualify. For example, your doctor may state that the wig is medically necessary for your mental health due to losing your hair from a disease.
Flexible Spending Account (FSA)
Like an HSA, you can put money into an FSA to pay for certain out-of-pocket health care costs. And the good news is that you don’t pay taxes on the money you contribute. As a result, you’ll save an amount equal to the taxes you would have paid on the money you set aside.
Your employer can also make contributions to your FSA, but they are not ‘required’ to do so. Yes, wigs are also covered for reimbursement using your FSA. But again, you must obtain a Letter of Medical Necessity from your doctor.