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What is a difference between a flexible spending account (FSA) and a health savings account (HSA)?

Employees must be enrolled in high deductible health plans to open FSA accounts.

Employees can only use HSA funds for medical expenses.

FSA funds must be used within the plan year or they will expire.

HSA accounts are typically funded by employers.

Respuesta :

Answer:

The fundamental difference between a flexible spending account (FSA) and a health savings account (HSA) is that an HSA is controlled by an individual and allows commitments to roll over, whereas FSAs are less adaptable and must be claimed by a company.

Explanation:

This means that if you leave your work, the funds in your FSA may be forfeited, whereas the assets in your HSA are entirely yours (and rollover into another HSA account). FSAs and HSAs both allow people to save money away for medical expenses on a tax-advantaged basis by paying for eligible medical expenses with pretax money.