Brian’s Tax Musings

Do you have an FSA (Flexible Spending Account) at your work?  This allows you to contribute an amount specified by your employer as before-tax money to pay for your medical expenses.  Sometimes the amount allowed has been as much as $5000.  You can still use FSA money to pay for a lot of medical expenses, but over-the-counter medication is no longer allowed in 2011 unless you have a doctor’s prescription. See this link for more info as well as some future changes under the Health Care Bill limiting the maximum contribution to these plans:

http://www.fivecentnickel.com/2010/08/30/flexible-spending-account-changes-for-2011-and-beyond/

The thing is, even with the new restrictions, it still is smart to contribute to these plans if your employer provides them.  WIth tax rates only going to go up in the future, any tax-advantaged vehicle can save you taxes on money you would have spent anyway.

Leave A Comment...

*