Dear Gina –
This has been a super-hot summer and my employees are asking me if sun-related products, i.e. sunscreens, protective clothing, etc. are FSA/HSA eligible expenses?
A: Agreed! This summer has been a scorcher. And, yours is a question we are getting asked frequently. The answer, however, is “it depends.” The answer primarily depends on whether the product effectively protects against sunburn, soothes an active sunburn or treats a medical condition that has arisen from a sun-related ailment.
Here are the various categories of sun-protective products and whether or not they are indeed eligible for reimbursement in an FSA or HSA:
Sunscreen (excluding cosmetics or similar products containing sunscreen): There is no official guidance on this item but an IRS official has informally commented that sunscreen will likely qualify as a medical care expense because its sole purpose is to prevent sunburn. Some FSA plans may take a more cautious approach, for example, by reimbursing only products at or above a specified SPF (e.g., 15 due to FSA guidance).
Sunscreen in cosmetics or similar products with suntan lotion but not just sunscreen: Not eligible. It does not prevent a medical condition such as sunburn.
Sunburn creams and ointments (medicated such as Solarcaine): This is an eligible expense to treat a sunburn (and not as a regular skin moisturizer).
Sunglasses: Eligible only if prescription sunglasses. It is unclear whether nonprescription sunglasses or clip-on sunglasses recommended by a physician to alleviate an eye condition would qualify.
Sun-protective (SPF) clothing: Not an eligible expense if used to maintain general health or for other personal reasons. May qualify if used to treat or alleviate a specific medical condition (e.g., melanoma) and if the expense would not have been incurred “but for” the condition, but only the excess cost of the specialized garment over the cost of ordinary clothing will qualify. To show that the expense is primarily for medical care, a note from a medical practitioner recommending the item to treat a specific medical condition is normally required.
So yes, the answer depends on the circumstances and specific products. Be sure to have your employees check with us if they are counting on a specific product being eligible for reimbursement or they may get burned.