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Frequently Asked Questions Insurance

Is the Federal Flexible Spending Account Program (FSAFEDS) going to be taxed next year?

No, flexible spending accounts are a pre-tax benefit.  By using pre-tax dollars to pay for eligible health care and dependent care expenses, a flexible spending account (FSA) gives you an immediate discount on these expenses that equals the taxes you would otherwise pay on that money.

In other words, with an FSA, you can both reduce your taxes and get more for your money by saving from 20% to more than 40% you would normally pay for out-of-pocket health care and dependent care expenses with after-tax (as opposed to taxed) dollars.

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