Flexible Spending Account

As a business owner, you can use an FSA to reduce your social security, Medicare, and unemployment tax liabilities. You’ll also leave employees with more spending money per paycheck, thanks to savings on out-of-pocket expenses like doctor and dentist co-pays, prescriptions, and day-care costs.

How Does a Flexible Spending Account Work?

FSAs set aside money from each paycheck before payroll taxes are deducted. This gives employees more take-home pay, while you pay less in FICA and FUTA payroll taxes.

Paychex FSA Benefits

Paychex helps you establish and manage an FSA for your business on our Paychex Benefit Account platform. We process claims daily, and provide the legal documentation, compliance testing calculations, and status reports to keep your employees’ accounts running smoothly. If you have questions, just call our toll-free support line and our FSA experts will be glad to answer them for you.

Benefits to Employers:


  • Easy Administration.
    • Easy setup and onboarding
    • Employee enrollment materials and claim processing
    • Comprehensive payroll integration
    • Preparation of required legal documents
    • Ongoing compliance testing
    • Convenient FSA debit card for employees
  • Options to Drive Participation. Choose a plan that allows participants to carry over up to $500 into the next plan year, or a plan with a grace period that allows expenses to be incurred until March 15 of the following plan year.
  • Enrollment Resources. Learn more.
  • Online Plan Management at the Paychex Benefit Account online portal.

Benefits to Employees:


  • Tax Savings. FSA deductions come out of each paycheck before most withholding taxes are computed, reducing taxable income and potentially increasing take-home pay.
  • Budgeting for Expenses.
  • Convenient Payment Option. The Paychex Benefit Account debit card can be used like a major credit card to access funds and pay for eligible items and services.
  • Access Anytime. The Paychex Benefit Account mobile app, online portal, and toll-free FSA Information Line make account management easy.
  • Reimbursements and Reminders. Quick claim processing, with reimbursements remitted throughout the business week, plus regular status reports and reminders.

View Minimum Requirements