what is fsa

In the United States, FSA stands for Flexible Spending Account, which is a tax-advantaged financial account that allows employees to set aside money on a pre-tax basis to pay for qualified medical expenses and dependent care expenses. The most common type of FSA is used to pay for medical and dental expenses not paid for by insurance, usually deductibles, copayments, and coinsurance for the employees health plan. FSAs can also be established to pay for certain expenses to care for dependents while the legal guardian is at work, including child care for children under the age of 13 and day care for an individual of any age who is incapable of self-care, lives with the taxpayer for more than one-half of the tax year, and is either the taxpayers spouse or dependent. With an FSA, you submit a claim to the FSA (through your employer) with proof of the medical expense and a statement that it hasnt been covered by your plan. Then, you’ll get reimbursed for your costs.