This video outlines the concept and rules of a Flexible Spending Account (FSA):
- FSAs allow for tax-free contributions and withdrawals for healthcare expenses.
- The employer owns the FSA, with the employee utilizing it through their workplace.
- FSAs cannot be used in conjunction with high deductible health plans that are eligible for HSAs.
- The “use it or lose it” rule applies, meaning funds must be used within the plan year or they are forfeited.
- Some employers may offer options for unused funds at the end of the year, like a spending grace period or a limited rollover to the next year.
