The IRS has released Revenue Procedure 2019-44 which details the 2020 pre-tax limits for the Health FSA and Commuter Plans. These limits are effective for plan years that begin on or after January 1, 2020. Below is a summary of the newly released limits:
Health Flexible Spending Account (Health FSA)
Employees may contribute up to $2,750 to a Health FSA. In addition, employers may contribute up to $500 or a dollar-for-dollar match of the employee’s contribution, whichever is greater. This is up $50 from 2019.
Carryover balances (of up to $500) do not count toward the contribution limits.
Dependent Care Flexible Spending Account (DC FSA)
The limits for the Dependent Care FSA have not changed.
Employees may contribute up to $5,000 to a DC FSA if they file their taxes as a single or married jointly.
Employees may contribute up to $2,500 to a DC FSA if they are married but file their taxes separately.
Employers may contribute to a DC FSA, but employer contributions count toward the limits.
DC FSA limits do not adjust for inflation.
Health Savings Account (HSA)
As a reminder, the 2020 HSA contribution limits were released earlier this year.
Employees may contribute $3,550 if they have single coverage and $7,100 if they have family coverage.
A catch-up contribution of $1,000 is available for people age 55 or older.
Employers may contribute to the HSA, but employer contributions count toward the limits.
Have additional questions about FSA or HSA Plans?