![]() ![]() What is the process of rolling over funds from my 2022 FSA to 2023? You’ll still be able to contribute up to $3,050, on top of any amount that you are allowed to roll over from 2022. If you’re able to rollover funds, it doesn’t affect the maximum amount you can contribute to an FSA in 2023. The exact amount you can roll over depends on your employer. But, keep in mind, your employer is not required to allow you to carry over funds at the end of the year.įor 2023, the carryover option allows you to roll over up to $610 of unspent FSA money at the end of the plan year. Reach out to your employer to determine if you can take advantage of a carryover option or a grace period. If you don’t use all the money in your 2022 FSA by the end of the year, you may be able to roll over a portion or all of your unused funds. Source: IRS How much of my 2022 FSA can I roll over to 2023? Maximum FSA contribution limit per person You’ll notice that the annual limit typically increasse by $50 or $100 every year, versus this year’s $200 increase. Here’s a table that shows maximum FSA contributions for 2016 through 2023. This led to a larger-than-usual increase in the FSA contribution limit from 2022 to 2023. Surging prices have pushed inflation to record numbers in 2022. Why does the FSA contribution cap increase each year?Įvery year, the FSA contribution limit is indexed to inflation. From 2021 to 2022, for example, the contribution limit increased $100, from $2,750 to $2,850. This $200 increase is higher than previous inflation-adjusted increases. The contribution limit for health FSAs is $3,0, up from $2,850 in 2022. How does the FSA limit for 2023 compare to the one from 2022? Any federal, payroll, or state taxes (depending on your state) would be based on that amount. If you contribute the maximum amount to an FSA in 2023, your taxable income would then be $46,950 for the year. But your employer may give you the option to use it to pay for other qualified healthcare expenses after you reach your insurance deductible.Ĭontributing money to an FSA allows you to reduce your taxable income. An LPFSA is primarily used to pay for dental and vision expenses. With this type of FSA, you can still contribute to an HSA if your employer allows it. If you have a limited-purpose FSA (LPFSA), you can also contribute up to $3,050 in 2023. You generally can’t contribute to a health FSA and health savings account (HSA) at the same time. Medical expenses, like monthly period supplies and over-the-counter products ![]() This type of FSA allows you to pay for qualified out-of-pocket expenses, such as: The annual contribution limit applies to health FSAs. ![]() If your spouse has a separate FSA under another employer plan, they can make a maximum contribution, too. In 2023, employees can contribute up to $3,050 to an FSA. This is a relatively large increase compared to previous years. In October 2022, the IRS announced the 2023 contribution limit for FSAs. What is the FSA contribution limit for 2023? The inflation-adjusted amount will allow you to put more tax-free dollars toward qualified healthcare items. But, like in previous years, the IRS has increased the contribution limit on FSAs for 2023. There is a limit to how much you can contribute to an FSA every year. If you use your FSA dollars to cover eligible expenses for you, your spouse, or your dependents, you don’t have to pay taxes on the money. Eligible expenses include certain medical, vision, and dental costs not covered by your health insurance plan. A flexible spending account (FSA) is an employer-sponsored health benefit that allows employees to pay for qualified out-of-pocket expenses.
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