FSA Contribution Calculator
Estimate your per-paycheck Flexible Spending Account deduction and the income and payroll tax you save by contributing pre-tax dollars.
How to use this tool
- Enter the total you plan to contribute to your FSA this year.
- Enter how many paychecks you receive per year.
- Enter your marginal income tax rate and your FICA rate (usually 7.65%).
- Read your per-paycheck deduction, tax savings, and net cost.
A health Flexible Spending Account (FSA) lets you pay for qualified medical, dental, and vision costs with pre-tax dollars taken from your paycheck. Because the money escapes income tax and payroll (FICA) tax, every dollar you route through an FSA effectively costs less than a dollar. This tool shows your per-paycheck deduction and the tax you save.
Formula
FSA per-paycheck cost and tax savings
Per-paycheck = Annual contribution ÷ Paychecks per year
Tax savings = Annual contribution × (Income rate + FICA rate)
Net cost = Annual contribution − Tax savings
Contributions are pre-tax, so they reduce both your taxable income and your FICA wage base.
How it works
An FSA contribution is deducted from your gross pay before income and payroll taxes are calculated, so the savings equal your contribution multiplied by your combined marginal tax rate. We add your income tax bracket (federal plus any state) to the FICA rate — Social Security and Medicare, normally 7.65% combined — to estimate the full per-dollar benefit. The net cost is what the money actually costs you out of take-home pay.
FSAs are generally 'use it or lose it': funds left at year-end are forfeited unless your plan offers a carryover (a limited amount rolls to next year) or a grace period (extra months to spend). Unlike an HSA, the full annual election is available on day one of the plan year even though you fund it gradually each paycheck — handy for a large early expense. The IRS sets the annual contribution maximum for health FSAs, which changes yearly.
This is general information, not tax advice. Your true savings depend on your exact brackets, wage base, and whether your income exceeds the Social Security cap. Estimate conservatively and only elect what you are confident you will spend so you do not forfeit unused funds.
Worked example
$2,400 election over 24 paychecks at a 22% bracket
- Per-paycheck: $2,400 ÷ 24 = $100 deducted each pay period.
- Combined rate: 22% income + 7.65% FICA = 29.65%.
- Tax savings: $2,400 × 0.2965 = $711.60.
- Net cost: $2,400 − $711.60 = $1,688.40.
Per-paycheck deduction: $100.00
Annual tax savings by contribution and combined tax rate
| Annual contribution | 20% combined | 29.65% combined | 35% combined |
|---|---|---|---|
| $1,000 | $200.00 | $296.50 | $350.00 |
| $2,400 | $480.00 | $711.60 | $840.00 |
| $3,200 | $640.00 | $948.80 | $1,120.00 |
Key terms
- FSA
- A Flexible Spending Account: an employer benefit that lets you pay qualified health costs with pre-tax salary.
- Use it or lose it
- The rule that FSA funds left at year-end are forfeited, unless the plan offers a carryover or grace period.
- FICA
- The combined Social Security and Medicare payroll tax, normally 7.65% of wages for an employee.
- Marginal tax rate
- The tax rate applied to your next dollar of income — the rate that determines how much an FSA deduction saves you.
Frequently asked questions
- How much does an FSA actually save me?
- You save your contribution times your combined income and payroll tax rate. At a 29.65% combined rate, a $2,400 contribution saves about $711.60, so it costs roughly $1,688 of take-home pay.
- What happens to FSA money I don't spend?
- Most plans follow 'use it or lose it' — unspent funds are forfeited at year-end. Some plans allow a limited carryover or a grace period, so check your plan's rules before electing a large amount.
- Can I have both an FSA and an HSA?
- Not a general-purpose health FSA alongside an HSA — that disqualifies HSA contributions. A 'limited-purpose' FSA (dental and vision only) can be paired with an HSA.