UpDate - Vol. 11, No. 29, Page U.D. BENEFITS-2
April 30, 1992
UD Benefits 1992-93
Health Care, Dependent Care Flexible Spending Accounts (FSAs)
reduce federal taxes
     During the enrollment period, eligible employees may enroll in a
Health Care FSA or a Dependent Care FSA. Current plan members who wish
to continue participation in an FSA must re-enroll for plan year
1992-93. They may also increase or decrease contributions for the new
plan year. All changes made during this enrollment period will be
effective with the first pay in July 1992.
     Contributions made to FSAs are not subject to federal or Delaware
income taxes, nor to Social Security, resulting in tax savings for
participants. However, the IRS does impose restrictions on these
accounts. The total amount of pre-tax contributions is limited and may
not be changed during the calendar year, except for certain life
events such as marriage, divorce, birth of a child or death. Also,
funds remaining in the participant's account at the end of the year
are forfeited.

Health Care FSA
     This benefit lets you set aside up to $1,500 from your salary
each plan year in pre-tax dollars to pay for any medical expenses the
federal government would allow as an income tax deduction, such as
deductibles, co-payments and dental and vision care expenses. Expenses
can be reimbursed through the account or claimed as a tax deduction,
but a participant cannot do both for the same expense.

Dependent Care FSA
     Up to $5,000 each plan year can be set aside on a pre-tax basis
in a Dependent Care FSA, regardless of the number of dependents.
However, only expenses for dependents up to age 13 may be submitted
for reimbursement. The Internal Revenue Code requires that the
participant report the tax identification number and address of the
care-giver. Dependent care costs reimbursed from the FSA reduce,
dollar for dollar, the amount available through the federal tax credit
for dependents.
     For more information on both types of FSAs and to request claim
forms for reimbursements,    please contact Bonnie Meldrom  at
831-6349 or Lee Woomer at 831-8156.