Securing Health Care
Flexible Spending Accounts (FSA)
Convenient & Controlled
The Flexible Spending Account (FSA) may be offered to you as part of your employer’s benefit package. Through an FSA, you can set aside pre-tax dollars for eligible medical, dental, vision and dependent care expenses. Your contribution is deducted from your paycheck in equal amounts each pay period. Depending on your expenses, an FSA could save you 25% or more on eligible expenses. However, it is important to plan ahead and anticipate medical expenses before enrolling in a FSA to avoid having to forfeit any unused funds.
There are four (4) types of accounts that could be offered under a Flexible Spending Account program, each offering unique features and opportunities to save money: Health Care, Limited Purpose, Dependent Care and Adoption Service.
Health Care – Save Smarter, Not Harder
We help you save now so your wallet doesn’t pay for it later.
Frequently offered alongside traditional co-pay health plans, the Health Care FSA helps employees pay for expenses not otherwise covered by their insurance. This account provides you with upfront access to your full annual election on the first day of the plan year to help you pay for eligible medical, dental and vision expenses incurred by you, your spouse and dependents.
Limited Purpose – Maximum Multiple-Plan Benefits
Optimize your benefits with Limited Purpose FSAs.
Dependent Care – Spread the Wealth
With Dependent Care, we ensure that your children can always depend on you.
Adoption Service – Uncomplicate the Adoption Process
Expand your family without breaking the bank.
Flexible Spending Account
53Cost Savings
An individual earns $45,000 annually and elects to contribute $3,300 annually to a Healthcare FSA to cover out-of-pocket medical costs.
YOUR ESTIMATED FSA COST SAVINGS EXAMPLE
| Without FSA | With FSA | |
|---|---|---|
| Gross Earnings | $45,000 | $45,000 |
| FSA Contributions | -$0.00 | $3,300 |
| Adjusted Gross Pay | = $45,000 | $41,700 |
| FICA, Fed/State Taxes | -$6,750 | $6,322.50 |
| Out-of-Pocket Medical Expenses | -$3,300 | $3,300 (covered by FSA) |
| Total Take Home | $34,950 | $35,377.50 |
TOTAL SAVINGS WITH THE FSA: $427.50
Who Is Eligible
Employee Eligibility
In general, an individual must simply be employed by an employer who offers one and be otherwise eligible for benefits. Note: Even if the eligible employee chooses not to enroll in their company’s health insurance (for example, if an employee chooses to be on their spouse’s insurance plan instead) they can still sign up for the FSA. Owners of the company can participate in the FSA solely on their tax filing status. Below is a summary of those rules.
- C-Corporation Owners - May participate in an FSA and receive reimbursements tax free. C-Corp owners may use their FSA to reimburse their medical expenses, as well as those of their spouse and dependent.
- Sole Proprietors - Cannot receive reimbursements tax-free. However, if the sole proprietor is married, and their spouse is a W-2 employee, then the spouse can receive the tax-free benefit. In this case, the FSA is set up in the spouse's name and the sole-proprietor is listed as a dependent.
- Partners - Cannot receive reimbursements tax-free. However, if the partner is married, and their spouse is a W-2 employee (but not a partner), then the spouse can receive the benefit tax-free. In this case, the FSA is set up in the spouse's name and the partner is listed as a dependent
- S-Corporation Owners - That own >2% of the company's shares and their spouse, parents, children, and grandchildren, cannot receive reimbursements tax-free (reimbursements are subject to federal income tax withholding).
- LLC's - Owner participation varies based on the way the LLC files taxes (as a Partnership, S-Corp, or C-Corp).
Contribution Limit
Annual Contribution Limits
| FSA Plan Type | 2025 |
|---|---|
| Health Care | $3,300 |
| Limited Purpose | $3,300 |
| Dependent Care |
$5,000 $2,500 |
| Adoption Assistance |
$17,280 |