If you have a health plan through a job, you can use a Flexible Spending Account (FSA) to pay for copayments, deductibles, some drugs, and some other health care costs. Using an FSA can reduce your taxes.

What is an FSA?

A Flexible Spending Account (also known as a flexible spending arrangement) is a special account you put money into that you use to pay for certain out-of-pocket health care costs.

You don’t pay taxes on this money. This means you’ll save an amount equal to the taxes you would have paid on the money you set aside.

You can use funds in your FSA to pay for certain medical expenses for you, your spouse if you’re married, and your dependents. This includes prescription eyewear, contacts, and other health items.

You can also use FSA to pay for copays and deductibles when you go for an exam.