Flexible Spending Accounts (FSAs)

A Flexible Spending Account (FSA) lets you set aside pre-tax dollars to pay for eligible healthcare or dependent care expenses, helping you save money on out-of-pocket costs. Keep in mind that FSAs are subject to the IRS “use it or lose it” rule, so it’s important to plan your contributions carefully. For Dependent Care FSAs, expenses must generally be incurred between January 1 and December 31 of the plan year, and any remaining balance after the deadline is forfeited.

Claims for Healthcare, Limited Purpose, and Dependent Care FSAs must be submitted by March 31 following the end of the plan year. Renew Home offers a grace period, which allows you to incur eligible Healthcare and Limited Purposes expenses from January 1, 2026 through March 15, 2027, with all claims due by March 31, 2027.

How Much Could You Save?

Flexible Spending Accounts (FSAs) are one of the easiest ways to reduce your taxable income and keep more of what you earn. When you contribute to an FSA, the money you set aside for eligible healthcare expenses is not taxed—meaning every dollar goes further. For example, let’s say Tom sets aside $2,000 in his FSA for the year. Normally, he’d pay $560 in federal income tax, $100 in state income tax, and $153 in FICA taxes on that amount. But by using his FSA, Tom avoids all those taxes and saves $813. That’s money he can use for things like doctor visits, prescriptions, or medical supplies—without it ever being taxed. FSAs don’t just help with budgeting—they help you make the most of your paycheck.