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Flexible Spending Account (FSA)

More than health savings

With an Aetna Flexible Spending Account, employees put in a portion of their salary before taxes. The “flexibility” in the fund’s name comes from employees’ ability to reimburse themselves not only for eligible medical expenses but some other costs as well. Here are some other details:

  • Employees put in money from their paycheck before taxes. 
  • The money can pay for covered health care and dependent care expenses. 
  • Leftover money is lost if not used by the end of the plan year.

Frequently asked questions about an FSA

Question Answer
Who is eligible? All employees, as defined by the IRS
Who can contribute? Employer, individual or both. 
Does the balance carry over? New IRS guidelines will allow up to $500 rollover.
Can rollover contributions from another account be made to this account? No
Is the fund or account portable? No
Are there interest or investment earnings? No
What are the tax advantages? Employers with a cafeteria plan enjoy FICA tax savings.
Are contributions taxable income to the employee?


In addition, contributions are not subject to FICA or FUTA taxes.

Are distributions ⁄ reimbursements taxable income to the employee? No

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