Flexible spending accounts (FSAs) have existed since the 1970s and are designed to help employees pay for qualified out-of-pocket expenses with pre-tax dollars. These accounts offer tax advantages that can reduce your overall taxable income, making them a smart option for many people managing health care or dependent care costs. FSAs are commonly offered by employers as part of a benefits package. They are used to cover a wide range of expenses, including prescriptions, doctor copays, childcare costs and even some over-the-counter items.
