Which consumer-directed health plan provides tax-exempt accounts offered by employers to any number of employees, which individuals use to pay health care bills? The employees contribute funds through a salary reduction agreement and withdraw funds to pay medical bills. Funds are exempt from both income tax and Social Security tax (and employers may also contribute). By law, employees forfeit unspent funds at the end of the year.

Question

Quizplus · Accepted Answer

A flexible spending account (FSA) allows employees to contribute pre-tax dollars to pay for eligible medical expenses. Unspent funds are forfeited at the end of the year.

Which Consumer-Directed Health Plan Provides Tax-Exempt Accounts Offered by Employers