FSA Details
Flexible spending accounts, or FSAs, provide you with an important tax advantage that can help you pay health care and dependent care expenses on a pre-tax basis. Essentially, the Internal Revenue Service (IRS) set up FSAs as a means to provide a tax break to employees.
As an employee, you agree to set aside a portion of your pre-tax salary in an account, and that money is deducted from your paycheck over the course of the year. The amount you contribute to the FSA is not subject to social security (FICA), federal, state or local income taxes — effectively adjusting your taxable salary.
The taxes you pay each paycheck and collectively each plan year can be reduced significantly, depending on your tax bracket. As a result of the personal tax savings you incur, your spendable income will increase.
| Account | 2026 IRS Maximum Contribution limit | Carryover or Grace Period to next year | HDHP compatible |
|---|---|---|---|
| Limited Purpose FSA | $3,400 | No | Yes |
| Dependent Care FSA | $7,500 (or $3,750 if married and filing taxes separately.) | No | Yes |
| Health Care FSA | $3,400 | No | No |
Health Care FSA
Make pre-tax contributions for medical, dental and vision expenses not paid by your, or your spouse’s insurance plans.
Dependent Care FSA
Set aside pre-tax contributions for dependent care expenses. You can use this account to pay for eligible child and adult care expenses like day care, before and after school care, preschool, and summer day camp.
Limited Purpose FSA
Only for Dental, Vision and Preventive Care costs
If you are enrolled on a High Deductible Health Plan as well as a Health Savings Account (HSA). The same rules of a general-purpose Health Care FSA apply, except employees are limited to deductions for dental and vision expenses only until certain thresholds are satisfied.
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