Final answer:
The three types of FSAs under IRS Section 125 are Healthcare, Dependent Care, and Adoption Assistance. These plans allow for pre-tax contributions towards eligible expenses related to medical, dependent care, and adoption.
Step-by-step explanation:
The student's question pertains to the three types of Flexible Spending Accounts (FSAs) under Internal Revenue Service (IRS) Section 125. The correct answer to the question is: c) Healthcare, dependent care, and adoption assistance. FSAs are employer-established benefit plans that allow employees to set aside pre-tax dollars for eligible expenses. A Healthcare FSA can be used for medical, dental, and vision expenses. A Dependent Care FSA is intended for qualifying expenses related to the care of a dependent, such as child or elder care. Lastly, an Adoption Assistance FSA helps employees pay for expenses related to the adoption of a child. It's important to note that these plans come with certain rules and limits regarding contributions and the use of funds within the plan year.