What is a flexible spending account?

Rishi

New member
What is a flexible spending account, and how does it save on taxes? Which expenses are eligible under a flexible spending account? What happens to unused FSA funds at the end of the year?
 
Imagine FSA as a tax loophole in a bottle, when you deposit money of your salary pre-taxes to buy medical items such as doctor visits, medicines, eyewear, or childcare, this reduces your income to subject to taxation. Only to remember, the majority of FSAs are use it or lose it and any leftovers are often lost at the end of the year (although, there are plans that have a slight rollover or grace period).
 
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