Flexible Spending Account | FSA
A flexible spending account (FSA) is a voluntary, employer-sponsored program for employees to save a portion of their income, pre-tax, to be used to pay for qualified medical or dependent care expenses incurred during their benefit plan year.
How it Works
Health and dependent care FSA plans give employees the opportunity to realize tax savings on medical and daycare expenses through two separate pre-tax accounts.
The money employees contribute to their Health FSA can be used to reimburse themselves for eligible, out-of-pocket health care expenses made for themselves and/or covered dependents. Accounts are funded through payroll deductions. The maximum annual amount a participant may elect to contribute to their Health FSA (for 2017, as determined by IRS Code section 125(i)) is $2,600. However, the employer determines the maximum contribution amount an individual may contribute to their health FSA during the plan year and may offer a lower annual maximum amount.
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