Flexible Spending Account
A Flexible Spending Account (FSA) is an employer owned account that lets you set aside pre-tax dollars (which lowers your taxable income) to pay for eligible out-of-pocket expenses. There are
two types of FSAs available to you:
1. Health Care FSA – Can be used to pay eligible medical, dental, orthodontia and vision expenses – 2024-2025 Agency Maximum Contribution = $2,500
2. Dependent Care FSA – Can be used to pay eligible expenses for childcare, eldercare or care for a disabled dependent – 2024-2025 Agency Maximum Contribution = $5,000
Your Pay (Pre-TAx) |
Without FSA |
With FSA |
|---|---|---|
Annual Income |
$30,000 |
$30,000 |
Flex Contribution |
$0 |
$2,500 |
Adjusted Income |
$30,000 |
$27,500 |
Taxes |
$3,860 |
$3,485 |
Take Home Pay |
$26,140 |
$24,015 |
FSA Eligible Expenses |
$2,500 |
$2,500 |
Payments From FSA |
$0 |
$2,500 |
Out of Pocket Expenses |
$2,500 |
$0 |
Take Home Pay |
$23,640 |
$24,015 |
Unused FSA funds do not carry over to the next plan year |