Quickly calculate your tax savings and paycheck impact with our FSA Calculator. Enter salary, contribution, and FSA type (Healthcare, Dependent Care, or Limited Purpose) to get instant, accurate results for better financial planning.
Paycheck Impact (as of 03:53 PM IST, Thursday, September 04, 2025)
| Category | Amount |
|---|---|
| FSA Contribution Per Paycheck | $114.58 |
| Tax Savings Per Paycheck | $28.24 |
| Net Reduction in Paycheck | $86.34 |
Your actual take-home pay will be reduced by $86.34 per paycheck, not the full contribution amount, due to tax savings.
Annual Summary
- Annual Income: $60,000.00
- FSA Type: Healthcare FSA (Max $3,300)
- FSA Contribution: $2,750.00
- Total Tax Savings: $677.88
- Effective Savings Rate: 24.7%
FSA Benefits Analysis
- With your Healthcare FSA contribution of $2,750.00, you’ll gain these advantages:
- Immediate Tax Savings: $677.88 in reduced taxes this year
- Full Availability: Your entire annual election is available on day one of the plan year
- Wide Range of Eligible Expenses: Medical, dental, vision, prescriptions, and over-the-counter medications
Remember that FSA funds typically must be used within the plan year, though your employer may offer:
- Grace period (up to 2.5 months after plan year)
- Carryover option (up to $660 for 2025)
Check with your plan administrator for your specific plan rules.
If you spend your full FSA contribution of $2,750.00, you’ll effectively pay only $2,072.13 out of pocket – a discount of 24.7%.
For example, a $200 eligible expense effectively costs you only $150.70 after tax savings.
Eligible Expense Suggestions
- Prescription medications and over-the-counter drugs with a prescription
- Medical equipment and supplies
- Copays, deductibles, and coinsurance
- Dental treatments and orthodontia
- Eye exams, glasses, contacts, and LASIK
- Many over-the-counter products (bandages, pregnancy tests, etc.)
Year-End Planning
- Check your FSA balance regularly
- Create a spending plan for any remaining funds
- Understand your plan’s specific deadlines and rules (grace period or carryover options)
- Keep all receipts for expenses, even if you use an FSA debit card
Next Year’s Enrollment
- Review this year’s expenses to better estimate next year’s needs
- Consider any planned procedures or expenses for the coming year
- Account for any expected family changes (new children, dependents no longer qualifying, etc.)
- Check for any updates to FSA contribution limits, which typically change annually
A Flexible Spending Account (FSA) allows you to set aside pre-tax dollars for qualified healthcare or dependent care expenses. By using pre-tax funds, you can significantly reduce your overall tax burden.
How FSA Tax Savings Work
- Pre-Tax Contributions: FSA contributions are deducted from your paycheck before taxes are calculated
- Reduced Taxable Income: This lowers your taxable income, reducing federal, state, and FICA taxes
- Immediate Savings: Unlike tax deductions claimed on your annual return, FSA tax benefits are realized immediately in each paycheck
- Multiple Tax Savings: You save on federal income tax, state income tax, Social Security tax, and Medicare tax
Types of FSAs
- Healthcare FSA: For qualified medical, dental, and vision expenses not covered by insurance
- Dependent Care FSA: For eligible childcare or adult dependent care expenses necessary for you (and your spouse) to work
- Limited Purpose FSA: Compatible with HSAs, covers qualified dental and vision expenses only
Important FSA Considerations
- Use-It-Or-Lose-It Rule: Most FSA funds must be used within the plan year, though employers may offer a grace period or limited rollover
- Contribution Limits: The IRS sets annual limits on how much you can contribute to each type of FSA
- Uniform Coverage Rule: For Healthcare FSAs, your full annual election is available on day one, even though contributions occur throughout the year
- Mid-year Changes: FSA elections generally cannot be changed during the plan year unless you experience a qualifying life event