Flexible Spending Accounts (FSAs): Give Yourself a Tax Break
Through an FSA, you can set aside tax-free dollars to pay for health care and/or dependent care expenses. FSAs allow you to save money because you don’t have to pay federal, Social Security, or state taxes on your contributions to these accounts. You have the option of electing any of the following account types:
Take a look at the Dependent Care FSA. Consider how it could save you money if you have dependent day care expenses and decide if it makes sense to give it a try for 2021.
Make Your Choice
Decide how much to contribute up to the limits for 2021: $5,550 for the Health Care FSA and Limited Purpose FSA, and $9,000 for the Dependent Care FSA.
Other Considerations
Things to know (Enrollment, accessing your funds, use-it or lose-it, $900 FSA rollover, forfeiture exception).