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Flexible Spending Accounts Overview
Home » Insurance » Flexible Spending Accounts » Flexible Spending Accounts OverviewIf you work at a corporation you probably get paid a salary or work for hourly wages and get many benefits. Some of your benefits may include holidays, sick day, vacation, and health insurance. Many corporations take so much money out of each employee's paycheck to cover for many of those benefits. And when they do it is taken out after taxes in most cases. However, there accounts you can get into that offer a better way to get benefits and save on taxes to. This type of account would be flexible spending accounts. With flexible spending accounts (FSA) you can pay for your medical or dental expenses and other benefits on a pre-tax basis. This will also help you lower your tax burden as well. Just what types of benefits can you get with FSA? Here is a couple you will find available:
• Tax benefits: According to the IRS, certain benefits are tax exempt. They are classified by the IRS as qualified benefits. By having a FSA, you could pay for these qualified benefits with pre-tax dollars. Such benefits could include health coverage, medical expenses that are not covered by the health plan, any deductibles, and co-payments associated with the health plans. Dental and vision benefits can also be included.
• OTC (over-the-counter) drugs: After September, 2003, anyone who has a FSA can use pre-tax dollars to get OTC drugs. But their employer's FSA plan has to allow it. The only expenses that will be allowed would include treatments for personal injuries, sickness, buying cold medicines, antacids, and pain relievers. Buying vitamins and food supplements are not included.
Related Flexible Spending Accounts Articles
- Flexible Spending Accounts Overview
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- Advantages and Disadvantages of Using Flexible Spending Accounts
- How to Plan Your FSA