HSA vs. FSA Overview
Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs) are tax-advantaged ways to save for healthcare costs, but they have important differences.
Health Savings Account (HSA)
- Requires enrollment in a High Deductible Health Plan (HDHP).
- Contributions are tax-deductible or pre-tax (via payroll).
- Earnings on investments grow tax-free.
- Withdrawals for qualified medical expenses are tax-free.
- Funds generally roll over year-to-year.
- Account is portable (stays with you if you change employers or leave the workforce).
- Can be invested.
Flexible Spending Account (FSA)
- Does NOT require an HDHP; can be paired with most health plans.
- Contributions are made with pre-tax dollars (via payroll).
- Funds typically must be used within the plan year (use-it-or-lose-it), though some plans allow a grace period or limited carryover.
- Account is generally NOT portable (tied to your employer).
- Cannot be invested.
- Can cover qualified medical, dental, and vision expenses.
Disclaimer: This overview provides general information. Specific plan details, contribution limits, eligible expenses, and rules may vary. Eligibility for an HSA depends on your health plan type. Consult your plan documents, a financial advisor, or a tax professional for personalized advice.
Estimated Income Tax Benefit from Contributions
Estimate the income tax reduction from contributing to either an HSA or FSA based on your contribution amount and a hypothetical tax rate.
Enter amounts above and click "Calculate Estimated Benefit".
Disclaimer: This calculator estimates only the income tax reduction from pre-tax contributions based on a hypothetical tax rate. It does **NOT** account for FICA tax savings, potential state tax differences, the tax-free growth benefit of an HSA, or your specific tax situation. Your actual tax savings may differ. Contribution limits apply to both accounts and vary annually. Consult a qualified tax or financial professional for personalized advice.