You apply for a flexible spending account (FSA) through your employer during open enrollment, typically in the fall for the upcoming plan year. There is no separate application to submit to the government or an insurance company. Your employer’s benefits portal or HR department handles the entire process, and the whole thing usually takes just a few minutes once you know how much you want to contribute.
Who Can Enroll in an FSA
FSAs are exclusively employer-sponsored. If your employer offers one as part of its benefits package, you’re generally eligible to sign up. Self-employed individuals, independent contractors, and anyone buying health coverage through the federal or state marketplace cannot open an FSA. You need to be on your employer’s benefits plan.
Most employers make FSAs available to all benefits-eligible employees, though part-time workers may or may not qualify depending on company policy. If you’re unsure whether your employer offers an FSA, check with your HR department or benefits administrator.
Health FSA vs. Dependent Care FSA
Employers commonly offer two types of FSAs, and you can enroll in both if they’re available. Each has its own contribution limit and rules for how the money works.
A health care FSA covers medical, dental, and vision expenses not paid by insurance. This includes copays, prescription costs, eyeglasses, and many over-the-counter items. One major advantage: the full annual amount you elect is available on day one of the plan year, even though your paycheck deductions happen gradually throughout the year. So if you elect $2,000 for the year and need $1,500 worth of dental work in January, you can use the funds immediately.
A dependent care FSA (DCFSA) covers child care, preschool, day camp, and elder care expenses that allow you and your spouse to work. Unlike a health care FSA, your balance only grows as payroll deductions come in. You can’t spend more than what’s been contributed so far. In divorce situations, only the parent who has custody can use DCFSA funds, and the IRS determines custody based on which household the dependent spends more nights in during the calendar year.
Some employers also offer a limited-purpose FSA (LPFSA), which covers only dental and vision expenses. This option exists mainly for people who have a health savings account (HSA) alongside a high-deductible health plan, since you generally can’t pair a regular health care FSA with an HSA.
When You Can Enroll
The primary window is your employer’s annual open enrollment period. Most companies run open enrollment sometime in the fall, with coverage starting January 1 or at the beginning of the plan year. Unlike health insurance, you must actively re-enroll in your FSA each year. Your election does not carry over automatically.
If you’re a new hire, you’ll typically get the chance to enroll during your initial benefits enrollment window, which usually falls within your first 30 days on the job.
Outside of those windows, you can only make changes to your FSA election if you experience a qualifying life event. These include getting married or divorced, having or adopting a baby, losing other health coverage, or a change in your spouse’s employment that affects their benefits. You’ll generally need to notify your employer within 30 days of the event and provide documentation.
How to Complete Enrollment
The actual enrollment process is straightforward. Your employer will direct you to one of two places: an online benefits portal or a paper enrollment form. Most mid-size and large employers use a digital system where you log in, select the FSA option, and enter your annual election amount. Smaller companies may still use a paper form routed through HR.
The key decision during enrollment is how much to contribute. For a health care FSA, the maximum for 2026 is $3,400. For a dependent care FSA, the limit is $5,000 per household (or $2,500 if you’re married and filing taxes separately). Your elected amount is divided evenly across your paychecks for the year as pretax deductions, which lowers your taxable income.
How to Decide Your Contribution Amount
Because FSAs operate on a “use it or lose it” basis, choosing the right amount matters. Start by reviewing your expenses from the past year. Look at what you spent on doctor visit copays, prescriptions, dental work, glasses or contacts, and any planned procedures. If you’re enrolling in a dependent care FSA, add up your annual child care or elder care costs.
Be conservative rather than aggressive. If your employer’s plan allows a carryover, up to $680 of unused health care FSA funds can roll into the next year in 2026. Some employers offer a grace period of up to 2.5 extra months to spend remaining funds instead. Your employer chooses one option or the other (or neither), so confirm which applies to you before you finalize your election. Any unused money beyond the carryover limit or grace period is forfeited.
What Happens After You Enroll
Once your enrollment is confirmed, your employer sets up pretax payroll deductions starting with your first paycheck of the plan year. You’ll receive an FSA debit card from your plan administrator, which you can use directly at pharmacies, doctor’s offices, and other eligible providers. If you pay out of pocket instead, you submit a claim for reimbursement through your administrator’s website or app, usually by uploading a receipt or explanation of benefits.
Keep your receipts. Plan administrators may ask you to verify that a purchase was for an eligible expense, sometimes months after the transaction. If you can’t provide documentation, the charge may be denied and you could owe the money back.
Tax Savings in Practice
Every dollar you put into an FSA avoids federal income tax, Social Security tax, and Medicare tax. If you’re in the 22% federal tax bracket and contribute $2,000 to a health care FSA, you save roughly $440 in federal income tax alone, plus another $153 in payroll taxes. That’s close to $600 back in your pocket for expenses you were going to pay anyway. State income tax savings, where applicable, add to the benefit. The dependent care FSA works the same way, and at the $5,000 maximum, the tax savings can easily exceed $1,500 for a household in a moderate tax bracket.