An example of when a flexible spending account (FSA) would be used is when an individual needs to undergo a medical procedure that is not fully covered by their health insurance plan. For instance, if a person requires braces, which are not typically covered by many insurance plans, they may use their FSA funds to cover the cost of the procedure.
FSAs enable individuals to set aside pre-tax dollars from their salary to cover certain healthcare expenses, including deductibles, copays, and eligible items and services that are not covered by insurance. Without the use of an FSA, individuals would need to pay for these expenses out of pocket with after-tax dollars, which could be a significant financial burden. Therefore, utilizing an FSA can provide a tax advantage and help to offset the costs of healthcare services that are not fully covered by insurance.
Not all health costs are covered by health insurance. Some examples of other payment services might be auto insurance, flexible spending accounts, and so on.
Give an example of when these other payment services would be used.
Explain why.
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