There are different kinds of FSAs, which are Health Care FSA, Limited Purpose FSA, and Dependent Care FSA. Though they are all flexible spending accounts, there are still several main differences in use as follows.
The coverage of eligible expenses
Health Care FSA: Medical, Dental, Vision, and Pharmacy's expenses
Limited Purpose FSA: Dental, Vision expenses
Dependent Care FSA: Non-medical dependent care expenses
The method of funding
Health Care FSA and Limited Purpose FSA: Pre-funded
Dependent Care FSA: Payroll-funded with annual election
Contribution limits (2021)
Health Care FSA and Limited Purpose FSA: $2,750 per FSAs/LPFSAs, regardless of whether you have family members who benefit from the funds in that account.
Dependent Care FSA: If married and filing jointly, the maximum annual election is typically $5,000. If married and filing separately, the maximum annual election is typically $2,500 per spouse.
Read more about contribution limits HERE
Access to Money
Health Care FSA and Limited Purpose FSA: An employee's yearly FSA allocation is available in full on the first day of the plan year, regardless of contributions to date.
Dependent Care FSA: An employee may only use the funds that are available in your account, not the entire election amount.
Health Care FSA and Limited Purpose FSA: runout date, grace period, rollover(carryover)
Dependent Care FSA: runout date, grace period, on-hold
**The IRS does not allow for DCFSAs to have a rollover option.
In general, we can find that Health Care FSA and Limited Purpose FSA are similar except for the coverage of eligible expenses while Dependent Care FSA is a completely different account compares to the others.