Flexible Spending Accounts (FSA’s) and Health Savings Accounts (HSA’s) are both great ways to reduce your income taxes by paying for medically-related expenses with pre-tax money- that is, money deducted from your paycheck before income taxes are calculated on your pay. Both types of accounts work similarly, in that you can deposit pre-tax money into the account, and use the account to pay for various tax-deductible medical expenses as they occur. But the two types of accounts operate quite differently.

Our company offers both an FSA and HSA option for the employees on our payroll, depending on which health insurance plan they select. I explain and compare the differences in the following ways: (Read More)