Flexible spending accounts allow employees to set aside before-tax dollars for medical and dependent care expenses.

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Flexible spending accounts (FSAs) are authorized by Section 125 of the Internal Revenue Code and allow employees to contribute part of their pre-tax income into a spending account which can be used to pay for eligible medical and dependent care expenses. This reduces the employee's taxable income and can provide significant tax savings.

Flexible Spending Accounts Allow Employees to Set Aside Before-Tax Dollars