A benefit that many employers are choosing to entice and retain valuable employees is called a “Flexible Spending Account.” These accounts allow for the use of pre-tax dollars to pay for certain healthcare expenses, co-pays, deductibles, some medications, and other costs. These accounts are typically called an “FSA.” This is a specially created account into which you put funds that can be accessed to pay for your out-of-pocket costs.

FSA’s Bring Tax Savings

The advantage is that your employees will not pay tax on the money put into an FSA. There are limits to the amount that can be put into the account every year — which can change year-to-year. The current limit is $2,550 per year, per employee. These funds can be used by your employee to pay for the following:

• The deductible amount on health or dental insurance
• Copayments
• Prescription medications
• Over-the-counter medications prescribed by a doctor
• Insulin
• Medical equipment (crutches, bandages, blood sugar test kits, etc.)

More about Flexible Spending Accounts

Employees are typically required to use the funds in your FSA each year, or other arrangements can be established when the plan is put in place. Some plans allow for a grace period of a few months in which to use the funds, while others allow a certain amount of money to be carried over into the following year.
Considering putting an FSA plan in place as part of your employee benefits package? Talk to us about your options, and let us do the heavy lifting for you. We are professional, service-oriented, and do everything possible to make the process as easy and stress-free as possible for business owners. Call us today to find out more.