We just did this for the first time this year. I did the full amount possible, taken out of my paycheck year round. It was great! Reduced our taxable income by $5000. I also did the medical costs one offered by my employer by an additional $3000.

The only downside is that you need to remember to submit documentation in order to get the money back that has been withheld from your paycheck. My employer is great at sending a couple reminders. It took me maybe an hour to gather, fill out and submit. Well worth it.

We just got a check cut to me directly from employer a couple weeks after submitting paperwork.