FSA -- Advantages for Employees
There are two types of Flexible Spending Accounts:
- Health Care FSAs — pays for the uncovered or unreimbursed portions of qualified medical costs.
- Dependent Care FSAs — pays for childcare or adult dependent care expenses that are necessary to allow you or your spouse to work, look for work, or attend school full-time.
Both accounts allow you to pay for these qualified expenses with pre-tax dollars, money that is deducted from your paycheck before taxes are taken out by your employer — saving you 20% to 40% or more.