The last section of your benefits packet is the one you are most likely to skip, and dollar for dollar it is the one that pays best for the least effort. It holds the pre-tax accounts and perks: payroll elections that let you pay for costs you already have — prescriptions, daycare, the train to work, a course — with money that is never taxed, plus a few services your employer simply pays for.
How "pre-tax" turns into cash
A pre-tax election comes out of your paycheck before income tax and before FICA, the 7.65% Social Security and Medicare tax. It lowers your taxable income, so each dollar you route through it saves your marginal tax rate plus 7.65%, plus state income tax if you pay one. Priya, the new hire from decoding your benefits package, earns $55,000. Her taxable income is $55,000 − $15,750 = $39,250 (after the standard deduction for 2025), which lands in the 12% federal bracket, so every pre-tax dollar saves her 19.65 cents. The paycheck calculator shows your own bracket and what a payroll deduction does to your take-home.
The health FSA and the dependent-care FSA
| Account | What it pays for | For 2025 | Year-end |
|---|---|---|---|
| Health FSA | Copays, prescriptions, dental, vision, glasses | $3,300 of salary | Forfeited, except a carryover of $660 or a short grace period if your plan offers one |
| Dependent-care FSA | Daycare, preschool, after-school and summer day camp for a child under 13, or care for a dependent who cannot care for themselves, so you can work | $5,000 per household, rising to $7,500 for plan years starting in 2026 (half of each if you are married and file separately) | Forfeited if unspent |
| HSA | Medical costs, paired with a high-deductible health plan | $4,300 self-only / $8,550 family | Rolls over; yours for life |
The health FSA has two rules that matter. Your whole election is available on day one — elect $1,000 in January and you can spend $1,000 in January, even though payroll has only deducted one month's share. And it is use-it-or-lose-it: whatever is left at the end of the plan year is forfeited, except the carryover or grace period your plan chose. Elect what you are sure you will spend — last year's copays and prescriptions — not a round number.
The dependent-care FSA pays for care that lets you (and your spouse, if you are married) work: a child under 13, or a dependent who cannot care for themselves. Its $5,000 figure is per household, not per parent, and it is forfeited if you do not spend it — but for a family paying daycare it is the biggest tax saver on this page: $5,000 × 19.65% = $982.50 a year in the 12% bracket. It also interacts with the child and dependent care tax credit; the financial side of a first child shows which one wins.
The HSA, briefly
The HSA sits in this bucket too, with friendlier rules: the money rolls over, can be invested, and stays yours after you leave. The price of admission is a high-deductible health plan, and being covered by a general-purpose health FSA — yours or your spouse's — makes you ineligible to contribute, so you cannot simply elect both. HSAs, FSAs and tax-advantaged health money has the full rules; here the point is the contrast: the FSA forfeits, the HSA keeps.
Commuter benefits, tuition help and the EAP
| Perk | What you get | For 2025 | Who funds it |
|---|---|---|---|
| Commuter benefit | Transit passes, vanpool rides and parking paid pre-tax | $325 a month for transit and $325 a month for parking | Your pre-tax dollars, plus any subsidy your employer adds |
| Tuition assistance | Tuition, fees, books and supplies for courses you take | $5,250 a year tax-free | Employer-paid |
| EAP (employee assistance program) | Confidential counseling sessions, plus legal, financial and family-problem referrals | Free; the number of sessions is in your plan summary | Employer-paid |
Commuter benefits apply the pre-tax discount to getting to work. For 2025 you can run $325 a month of transit fares and, separately, $325 a month of parking through payroll before tax. Check how often your plan lets you change the amount, because commutes change.
Tuition assistance under an employer educational assistance program is tax-free to you for the first $5,250 a year: the employer pays, and it never shows up in your wages. Most programs require a passing grade and some ask you to stay a set period after they pay, so read the fine print before you enroll in a course.
The EAP is the perk nobody remembers until a bad week: free, confidential counseling and referrals for legal, financial and family problems, paid entirely by your employer. Its phone number is in the packet, and using it costs you nothing.