Yes. FSA funds can be used for eligible expenses for your spouse or dependents, even if they aren’t enrolled in your health insurance plan. But access to your HSA funds could disqualify them from contributing to an HSA.
Tax-Advantaged Accounts
Tax-advantaged accounts help individuals and employers save on healthcare and dependent care costs by reducing taxable income. This category includes FSAs, HSAs, HRAs, and Premium Only Plans (POPs)—each with its own rules, benefits, and use cases. Learn how these tools work, who qualifies, and how to use them effectively to get the most value.
What’s the difference between a healthcare FSA and a dependent care FSA?
Healthcare FSAs cover medical expenses and are fully available day one. Dependent care FSAs help with work-related child or elder care costs and are only available as funds are contributed.
What is the Uniform Coverage Rule for FSAs?
With healthcare FSAs, your full annual election is available on day one—even though you repay it through payroll deductions over the year. Employers front the funds and carry the risk.
What is the Irrevocable Election Rule for FSAs?
FSA elections are generally locked in for the entire plan year. You can’t change your contribution unless you experience a qualifying life event, and your employer’s plan allows mid-year changes.
How much can an employer contribute to an employee’s FSA?
Employer FSA contributions are capped at the greater of $500 or a dollar-for-dollar match of the employee’s contribution. Contributions must follow IRS rules and plan design limits.
What is the maximum contribution to a healthcare FSA in 2025?
The 2025 FSA contribution limit is $3,300 per employee, regardless of whether they have individual or family coverage. Employers may also contribute additional funds, depending on the employee’s contribution amount.
Does an employee need to enroll in the group health plan in order to sign up for an FSA?
No. Employees don’t have to enroll in the group health plan to participate in a healthcare FSA—but the employer must offer a group health plan to offer an FSA.
Can I have an FSA and an HSA at the same time?
Usually not—unless the FSA is limited-purpose (covering only dental and vision). General-purpose FSAs make you ineligible to contribute to an HSA under IRS rules.
What happens to unused FSA funds at the end of the year?
FSA funds are generally “use it or lose it,” but your employer may offer a grace period or allow up to 20% of the maximum contribution (up to $660 in 2025) to roll over into the next plan year.
What can I use FSA funds for?
FSA funds can be used for eligible out-of-pocket expenses like copays, prescriptions, dental and vision care, and over-the-counter items. Exact eligibility follows IRS guidelines and your plan’s rules.
What is a Flexible Spending Account (FSA)?
An FSA lets employees set aside pre-tax dollars to pay for eligible medical or dependent care expenses. It lowers taxable income but is generally “use it or lose it.”