2018 FSA Contribution Limit Increases

10-23-2017

Last week the IRS announced adjusted benefit limits that will apply to the 2018 tax year, including the indexed Health FSA contribution limit and Parking and Transit contribution limits. You can read more about them at  Revenue Ruling 2017-58.

Health FSA Limit for 2018: Under the Affordable Care Act, the maximum Health FSA election was limited to $2,500 starting in 2013, with the maximum to be indexed annually for inflation.  The first index in 2015 increased the limit to $2,550; next in 2017 increased to $2600. Now, the limit will increase to $2,650 for 2018.

The table below shows the 2017 and 2018 contribution limits for FSAs and Parking and Transit plans.

  2017 2018
Health FSA maximum annual contribution $2,600 $2,650
Maximum Carryover $500 $500
Dependent Care FSA maximum annual contribution $5,000 $5,000
Transit &Parking Reimbursement monthly limit $255 $260