Health Flexible Spending Accounts (Heath FSAs)

Health flexible spending accounts (Health FSAs) are medical reimbursement plans that are a flexible spending arrangement. They allow employees to take pre-tax salary reductions to pay for certain medical expenses for themselves, their spouses and/or dependents.


  • Any employee is eligible (subject to employer-designed exclusions)
  • Employees save on federal and state income tax, along with FICA and Medicare taxes (approximately 30%)
  • Employers save on FICA and Medicare taxes (7.65%)
  • Maximum contributions levels are set by the employer
  • IRS non-discrimination rules apply
  • Must have a written Plan Document
  • Participants are required to receive a Summary Plan Description
  • In some cases, Form 5500 is required


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