Flexible Spending Accounts (FSA) Overview – 2026
A Flexible Spending Account (FSA) is a tax-free account that allows you to set aside pre-tax dollars to pay for eligible medical, dental, vision, and hearing expenses.
How It Works
- During Open Enrollment, you estimate your qualifying expenses for the coming year.
- Contributions are deducted from your paycheck on a pre-tax basis throughout the year.
- As eligible expenses occur, you can request tax-free reimbursements from your FSA.
- Your full annual election amount is available on day one of the plan year.
Important: FSA funds are “use it or lose it” — unused funds do not carry over to the next plan year. It is recommended that contributions be based on predictable medical and dependent care expenses.
Types of FSAs
General Purpose Health FSA
Reimburses eligible medical, dental, vision, and hearing expenses for you and your dependents.
Limited Purpose FSA
If you contribute to a Health Savings Account (HSA), you cannot have a General Purpose Health FSA. However, you can have a Limited Purpose FSA.
A Limited Purpose FSA reimburses:
- Dental expenses
- Vision expenses
- Post-deductible medical expenses
Dependent Care FSA
Allows tax-free reimbursement for eligible dependent care expenses, such as daycare or before/after school care, so you and your spouse can work or attend school.
What You Need to Do
- Estimate your eligible expenses for the upcoming year.
- Complete the appropriate election form during Open Enrollment.
- Submit the paperwork to the Human Resources Department.