Health Savings Accounts, Flexible Spending Accounts, and Dependent Care Assistance Plans in Oregon Divorce

Health Savings Accounts (HSA), Flexible Spending Accounts (FSA), and Dependent Care Assistance Plans (DCAP) are tax-advantaged savings accounts to set aside money for specific purposes.

All three have monetary value and will be discussed in your divorce mediation sessions. There are important difference among the three, and those differences affect how transferable each one is. Matthew will help you sort out the distinctions and options in mediation, but here is a snapshot:

Given those limitations, your divorce mediator's role is even more important. If your Marital Settlement Agreement (MSA) is drafted properly, it will be possible to make full use of DCAP and FSA funds. Matthew has considerable experience doing so, and he will draft your MSA to provide you the greatest possible advantages.

Health Savings Accounts

An HSA is for pre-tax money to be set aside to pay for health-related expenses. An HSA rolls over from year to year and can be transferred from one spouse's HSA to the other spouse's HSA.

More about Health Savings Accounts

Flexible Spending Accounts

An FSA is typically a "use it or lose it" account whose funds must be depleted by the end of the year, with any leftover balance typically forfeited. FSA funds cannot be transferred from spouse to spouse, but the value of the account can be recognized by assigning another asset of similar value to the other spouse.

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Dependent Care Assistance Plans

A DCAP is similar to an FSA in that it cannot be transferred from one spouse to the other. Its value can be assigned in the form of a different asset, however.

The scope of a DCAP's qualified expenses is even more limited than that of an FSA. A DCAP can be used only for qualified childcare expenses and only by the parent who has the greater amount of parenting time, even if the agreement or court order states that the parent who has the DCAP must pay for childcare expenses.

More about Dependent Care Assistance Plans

About the Author

I am a family and divorce mediator and a family law financial analyst operating as a solo practitioner in Portland, Oregon. I combine my law degree (J.D.) and 21 years of experience writing parenting plans to help clients navigate the legal, practical, and financial realities of divorce.

Disclaimer

I hold a law degree, but I do not practice law. The information provided on this website is for educational and informational purposes only and does not constitute legal or financial advice. You should consult with your own independent legal or financial professionals regarding your specific circumstances before making any decisions. No mediator-client relationship is formed by your use of this website or its information.