Health & Dependent Care Flexible Spending Accounts
pre-tax salary reduction limit for Health
Care FSAs will increase
to $2,850 for plan years on or after January 1, 2022.
Health Care FSA pre-tax salary reduction limit is per employee, per employer,
per plan year. If the employer contributes to the Health Care FSA, the
employer’s contribution is in addition to the amount that the employee can
elect to set aside through pre-tax salary reductions. As a result, the employee
could have more than $2,850 available
per plan year to reimburse qualified medical expenses if the employer
contribution is part of the plan design.
an employer has adopted the option of up to $500
rollover for the Health Care FSA, any amount that rolls over into
the new plan year does not affect the maximum election the employee can make.
note that Dependent Care (DCA) limits
have not changed and remain at a maximum
of $5,000 for 2022.
Parking and Transit Limits
and Transportation limits for 2022 each have increased to $280 per month.
*To view the full
update to the 2022 tax provisions please refer to Revenue Procedure 2021-45.