Flexible spending arrangements are employer–established benefit plans that allow employees to be reimbursed for qualified medical expenses. FSA’s are funded through voluntary salary reductions agreements (contributions) with your employer. No employment or federal income taxes are deducted from employee contributions, which is beneficial to both the employee and employer. An employer may also contribute to an employee’s FSA.
Salary reduction contributions to an FSA cannot exceed $2,500 a year, and the contribution amount is designated by the employee at the beginning of the plan year. FSA’s can provide for either a grace period or carryover amount up to $500 in order to allow for maximum availability of funds to be paid or reimbursed for qualified medical expenses incurred by the employee and the employee’s souse and dependents during the period of coverage. Distributions / withdrawals from the FSA for qualified medical expenses are also tax free.
Our comprehensive range of benefits makes the OSMA Insurance Agency the source for all your insurance needs.