Flexible Spending Accounts (FSA)
A Flexible Spending Account or FSA allows employees to use pre-tax earnings to pay for eligible out-of-pocket health care expenses and dependent care, potentially saving you hundreds of dollars while reducing taxable income. With a little up-front planning, participants can use FSA to pay for a wide array of out-of-pocket healthcare and/or dependent care expenses, such as:
- Doctor co-pays
- Over-the-counter drugs and prescriptions
- Chiropractic treatments
- Prescribed weight-loss programs
- LASIK procedures or eye surgery
Using FSA, employees can hold on to more of their paychecks in an easily-accessible account. Once they enroll, the entire amount estimated (not to exceed plan limit) for healthcare expenses for the year will be available on the first day of the plan year. All they need to do is plan ahead, budget, and enroll! (Enrollment is required every plan year for continued participation.)
Save on Before/After-School Care, Nursery, and Preschool
Working parents? Did you know employees can use their FSA to pay for childcare? Simply estimate costs for those services for the coming year. Complete the enrollment form (IRS maximum per year is $5,000 for married couples and $2,500 for parents filing separately) and elections will be divided by the number of pay periods for the plan year and will be deducted automatically from paychecks before taxes are calculated. Now participants can save for something they pay for every month and use the extra money they take home for other things.
For more information regarding Flexible Spending Accounts, including eligible and ineligible expenses, general IRS rules, and the reimbursement process, please visit our FSA Participant Handbook.