Employers, Flexible Spending Accounts (FSA), Health Reimbursement Arrangements, Open Enrollment, Participants, Commuter Benefits
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The IRS released 2023 contribution limits for medical flexible spending accounts (medical FSAs), commuter benefits, and more as part of . Limits are adjusted annually to reflect inflation.
2023 medical FSA contribution limits (including limited and combination FSAs)
The maximum amount that may be excluded from an employee鈥檚 gross income for the adoption of a special needs child through an adoption assistance program is $15,950. That amount is the same as what may be excluded from that employee鈥檚 gross income for expenses incurred by an employer for qualified adoption expenses within the program.
The available adoption credit begins to phase out for taxpayers with modified adjusted gross income in excess of $239,230 and is completely phased out for taxpayers with modified adjusted gross income of $279,230 or more.
2023 qualified small employer health reimbursement arrangement (QSEHRA) limits
The 2023 medical FSA contribution limit will be $3,050 per year, which is a $200 increase from 2022.
Employers can allow employees to carry over $610 from their medical FSA for taxable years beginning in 2023, which is a $40 increase from 2022.
The monthly commuter benefits limit in 2023 for mass transit and parking is $300 per month.
Employer contribution limits for QSEHRAs are $5,850 for self-only and $11,800 for families.
2023 HSA contribution limits were previously announced by the IRS. The HSA limit is $3,850 for an individual and $7,750 for family.
Would you like to learn more about medical FSAs? Rida Wong from shared eight things you should know about medical FSAs on a recent episode of our Benefits Buzz podcast.
The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own legal counsel, tax and investment advisers.
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