Benefit that allows employees to set aside a portion of their wages, before taxes are taken out, to pay for certain dependent-care expenses such as child care or elder care, over-the-counter medically related items, and health premiums. Funds are taken out of an employee’s wages through payroll deductions and put into an account controlled by a plan administrator. The employee submits proof of qualified expenses to the plan administrator, who will reimburse the employee from the employee’s account. Employees have to estimate expenses carefully because any unused money at the end of the year is forfeited. Also known as a tax saver or flexible spending account (FSA) .