What is FSA or HSA? A Comprehensive Guide to Flex Spending and Health Savings Accounts

Flexible Spending Account (FSA) and Health Savings Account (HSA) are both financial tools that help individuals save money for medical expenses. These accounts allow you to set aside pre-tax dollars for qualified healthcare expenses, which can help you save on taxes and budget for healthcare costs.

FSAs are employer-sponsored benefit plans that enable employees to contribute a portion of their salary to pay for qualified medical expenses. On the other hand, HSAs are available to individuals with high-deductible health plans and offer a triple tax advantage - contributions are tax-deductible, grow tax-free, and can be withdrawn tax-free for medical expenses.

Key differences between FSA and HSA:

• Eligibility: FSAs are available through employers, while HSAs are available to individuals with high-deductible health plans.
• Contribution Limits: FSAs have set contribution limits determined by employers, whereas HSAs have annual contribution limits set by the IRS.
• Portability: FSAs are typically
  

  Flexible Spending Accounts (FSA) and Health Savings Accounts (HSA) are financial tools that empower you to manage healthcare costs effectively, allowing pre-tax contributions to help cover qualified medical expenses.