FLEXIBLE SPENDING ACCOUNTS

Your contributions are made with pretax dollars from your pay — before federal income taxes and Social Security taxes are calculated. 


Another way you can save money is by participating in Health Care and/or Dependent Care Flexible Spending Accounts (FSAs). Your contributions are made with pretax dollars from your pay — before federal income taxes and Social Security taxes are calculated. As a result, your taxable income is lower, so you pay less taxes in each paycheck. Then, when you have an eligible expense, you reimburse yourself with tax-free money from your account. 

Eligible Expenses

Health Care FSA. Use this account to pay for expenses not covered by any medical, prescription drug, dental, vision, or any other applicable and eligible plans, as well as copays, deductibles, and charges that exceed any benefit maximum limits or the reasonable and customary allowance.

Dependent Care FSA. Use this account to pay for day care expenses for your dependent child(ren) under the age of 13 or other eligible dependents so you and your spouse, if married, can work or look for work.

Important Facts About the FSAs

In exchange for tax advantages, the IRS requires eligible expenses are incurred and submitted timely, so you will not forfeit any unused balances. The following rules apply to FSAs: 




  • You must use it or lose it. Estimate carefully. You will forfeit any balance left in your FSA(s) after all your incurred expenses are submitted and paid (according to the timeframes in the chart on the following page). You cannot roll it over to the next year.
  • The two Accounts are separate. You cannot use the money in your Health Care FSA to pay for Dependent Care expenses, and vice versa.
  • You MUST elect FSA each year. If you participated in 2024, you MUST elect to enroll for 2025. To enroll for 2025, download the enrollment form.

FSA Decision Guidelines

Before participating in an FSA, ask yourself several questions:

  • How much did I spend on out-of-pocket health care and dependent care expenses last year?
  • Do I expect to pay for some health care costs that are not totally covered by my benefits?
  • Do I pay someone to care for my dependent(s) while I work?
  • Am I eligible for a tax credit for any health care or dependent care related expenses? If so, will the tax credit or FSA participation be better for me?
  • Does my spouse have FSAs available through an employer? If so, how do we want to coordinate our accounts?
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