Open An Flexible Spending Account (FSA) For Your Small Business
Did you know, a small business can set up a Flexible Spending Account for individual employees’ medical expenses. FSA plans are established and offered through an employer for the benefit of the employees. These funds are not subject to federal income or Social Securty taxes.
This means:
The employees can elect to contribute part of their wages to the Flexible Spending Account, or FSA. There is a max contribution of $2,650 per year. The money can be used for prescription only drugs and co-pays throughout the year. You do not pay taxes on this money. All of the funds in an employee’s FSA must be used to pay medical expenses no later than 2 ½ months after the end of the calendar year or they are forfeited.
In return:
This benefit allows employees to pay medical expenses with pretax dollars and businesses save a little on their share of payroll taxes.
Takeaway
An FSA account can be beneficial to your business and your employees. Would you like to set up an FSA account for your small business? Call Profit Wise today and we can assist! 256.489.1478 or schedule a direct appointment below.
