Flexible Spending Accounts (FSA)
 Employer-sponsored flexible spending accounts (FSAs) are benefit
plan arrangements that allow employees to pay for certain health
care or dependent care expenses on a pre-tax basis. There are
two FSA options. A Health Care FSA is an alternate way of paying
your share of your health care costs. In the same manner, a Dependent/Child
Care FSA reimburses you for expenses for dependents and childcare
which are necessary to allow you and your spouse to work.
When you create an FSA, you choose to have a specific amount of
your annual salary withheld from your paycheck and deposited to your
FSA. These withholdings are on a pre-tax basis. Flexible
Spending Accounts (FSA’s) are benefit options designed
to increase your disposable income by reducing the amount of taxes
you pay. An FSA enables you to use pretax dollars to pay for
qualified health care expenses which are not reimbursed under any
health care plan or insurance plan, while a Dependent Care FSA pays
for your qualified dependent/child care expenses. However,
FSA funds are not interchangeable.
Flexible spending accounts offer significant tax advantages. Employees
do not pay federal income, state income, or FICA taxes on the salary
they contribute to a FSA plan. Employers, in turn, do not pay matching
FICA (7.65%) and FUTA taxes because employees' gross incomes are
significantly reduced. A health care FSA, which allows
employees to pay co-payments and deductibles with tax-free dollars,
can go a long way to helping employees shoulder their share of the
burden. FSAs are excellent tools for employees
in savings significant tax dollars especially in this day of rising
health care costs.
Flexible Spending Accounts (FSA) Quote Request
Please take a moment to fill out the form below and one of our local insurance agents will contact you with a free, no-obligation quote. This information will be kept confidential and will be used for quote purposes only.
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