Flexible Spending Account
A Flexible Spending Account (FSA) lets employees and their employers put aside money to spend on health care or dependent care. An FSA is a way to spend less on taxes. Things you should know about FSA's:
- Beginning in 2013, you will only be able to put $2,500 a year into an FSA.
- An FSA can only pay for qualified medical expenses not covered by health insurance. Qualified medical expenses include doctor and dental visits and prescriptions.
- An FSA can also pay for dependent care for children or adults.
- You must use your FSA money within 2 1/2 months after the end of the year or the money will be lost.
- Your employer may contribute money to your FSA.
- People with a Health Savings Account (HSA) may only have a dependent care FSA or a limited health care FSA that pays for services such as dental and vision.