Vanity surgery isn't FSA eligible

Dear Tax Talk,
Can flexible spending account contributions be used to help finance cosmetic surgery or dentistry? Thanks for your help. -- Dean

Dear Dean,
A flexible spending account, or FSA, is an arrangement between an employer and employee to defer a certain portion of an employee's salary to pay for eligible expenses. These eligible reimbursements would be excluded from the employee's wages, thus avoiding income, FICA and Medicare taxes.

For example, an employee that earns $30,000 a year may elect to defer $1,000 of his wages into an FSA to pay for child care or unreimbursed medical expenses. The employee would be paid $29,000 in wages through his periodic pay with the appropriate taxes deducted and would claim the additional $1,000 in deferred wages by submitting eligible expenses to his employer, where no taxes would be deducted.

To qualify for the income exclusion, an FSA may only provide benefits that reimburse expenses for medical care as defined in Section 213(d) of the Internal Revenue Code. Each medical care expense submitted for reimbursement must be substantiated. Excluded from Section 213(d) are cosmetic procedures:

(A) In general -- The term "medical care'' does not include cosmetic surgery or other similar procedures, unless the surgery or procedure is necessary to ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or disfiguring disease.
(B) Cosmetic surgery -- The term "cosmetic surgery'' means any procedure which is directed at improving the patient's appearance and does not meaningfully promote the proper function of the body or prevent or treat illness or disease.

Therefore, unless the cosmetic surgery or cosmetic dentistry falls into an exception such as congenital or accidental, the FSA cannot reimburse the expenses.