What are the limits for 2023 medical flexible spending account?

Asked by: Stan Kihn  |  Last update: January 3, 2024
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The IRS has increased the Flexible Spending Account (FSA) contribution limits for the Health Care Flexible Spending Account (HCFSA) and the Limited Expense Health Care FSA (LEX HCFSA). For 2023, participants may contribute up to an annual maximum of $3,050 for a HCFSA or LEX HCFSA.

How much can I contribute to my FSA in 2024?

In Plan Year 2024, if you have a health care or limited-purpose FSA, you will be able to set aside up to $3,050 for the year through monthly, tax-free deductions from your paycheck. (The maximum contribution for dependent care FSAs remains the same, at $5,000 for the year.)

How do I spend my FSA money 2023?

How to use FSA money. Common purchases include everyday health care products like bandages, thermometers and glasses. Everything from medical expenses that aren't covered by a health plan (like deductibles and co-pays to dependent day care) to over-the-counter medication can also be eligible.

What is the maximum 401k contribution for 2023?

The 401(k) contribution limit for 2023 is $22,500 for employee contributions and $66,000 for combined employee and employer contributions. If you're age 50 or older, you're eligible for an additional $7,500 in catch-up contributions, raising your employee contribution limit to $30,000.

What is the catch-up for 2023?

Here are some of the changes for 2023:

The catch-up contribution limit for employees age 50 and over who participate in 401(k), 403(b), most 457 plans and the federal government's Thrift Savings Plan will increase to $7,500.

Your flexible spending account: What can you get and when does it expire?

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What are the new retirement rules for 2023?

New Rules for Required Minimum Distributions

The age at which you must begin taking RMDs is increasing, from 72 to 73 in 2023, and to 75 in 2033. SECURE 2.0 also eliminates the RMD requirement for employer-sponsored Roth plans, such as Roth 401(k) accounts, starting in 2024.

What is the age 50 catch-up limit for 2023?

The catch-up contribution limit for workers at least 50 years old who participate in a SIMPLE plan is $3,000 for 2022 ($3,500 for 2023). Starting in 2024, the catch-up contribution limit for a SIMPLE plan is increased by 10%.

Are FSA limits changing for 2023?

The IRS has increased the Flexible Spending Account (FSA) contribution limits for the Health Care Flexible Spending Account (HCFSA) and the Limited Expense Health Care FSA (LEX HCFSA). For 2023, participants may contribute up to an annual maximum of $3,050 for a HCFSA or LEX HCFSA.

Can I buy vitamins with FSA?

FSA and HSAs won't cover a vitamin supplement geared toward general health and wellness. A vitamin is eligible for coverage by an FSA or HSA only if that vitamin has been recommended by a medical professional for the treatment or prevention of a specific disease or condition.

Can you buy groceries with a Flex card?

A major source of confusion around the Medicare Flex Cards is whether you can purchase food with them or not. In short, you can use the card to pay for groceries. This is something that differs from state to state and in some, specific campaigns offer the chance for a nutritious diet benefits token.

Will 2023 FSA roll over to 2024?

If a cafeteria plan permits health FSA carryovers, the maximum amount that a participant can carry over from the 2023 to the 2024 plan year is $610 – a $40 increase.

How much can you contribute to an FSA annually?

Employees can put an extra $200 into their health care flexible spending accounts (health FSAs) next year, the IRS announced on Oct. 18, as the annual contribution limit rises to $3,050, up from $2,850 in 2022. The increase is double the $100 rise from 2021 to 2022 and reflects recent inflation.

What is the limited purpose FSA rollover for 2023?

What happens to my Limited Purpose Health Care FSA funds at the end of the calendar year? Similar to the standard GPHC FSA, you can carryover up to $610 into the next plan year. Any amount over that is forfeited after the run-out period allowing you to submit eligible claims for plan year 2023 ends on March 31, 2024.

How much can a married couple contribute to a medical FSA in 2023?

The 2023 annual limit for this type of FSA is $5,000 for a married couple filing jointly, or $2,500 for each individual FSA if you each have a separate account. Note: this is the contribution limit imposed by the IRS. Employers can choose to limit employees' contributions even further.

What is the maximum amount an employee can contribute to an FSA?

The maximum amount an employee can contribute to a health care FSA is set by the employer as long as it does not exceed the Internal Revenue Service (IRS) maximum of $3,050 for the 2023 plan year. The IRS maximum is indexed to the consumer price index annually to account for changes in the cost of living.

Can you have two flexible spending accounts?

It's not uncommon for there to be multiple FSA accounts in a single household if the adults in the home each have one through their employer. Since an FSA lets you apply tax-free dollars towards eligible medical expenses, it makes sense financially for everyone in the family to take advantage of the benefit.

Can a married couple have two flexible spending accounts?

Healthcare FSAs Are Individual Accounts

There is not a family contribution option. Both you and your spouse can each have your own Healthcare FSA through your respective employers and both contribute the maximum amount to each account.

What is the maximum commuter benefit limit for 2023?

Qualified parking exclusion and commuter transportation benefit. For 2023, the monthly exclusion for qualified parking is $300 and the monthly exclusion for commuter highway vehicle transportation and transit passes is $300.

What happens if you contribute too much to an FSA?

If you contribute more than you can reasonably use within a year, the money will ultimately return to your employer. More than likely, your employer will then use this extra money to pay administrative costs on FSA accounts. That said, some employers offer a grace period that bumps the annual deadline to a later month.

Should I max out my FSA?

In 2022, the limit is $2,750 per year per employer. “Maxing out your contributions is only a good idea if you know you'll spend that much or more on medical bills during the year,” says Melanie Musson. Musson is a finance expert with U.S. Insurance Agents, an online insurance comparison site.

What happens to unused FSA funds?

For employees, the main downside to an FSA is the use-it-or-lose-it rule. If the employee fails to incur enough qualified expenses to drain his or her FSA each year, any leftover balance generally reverts back to the employer.

Is sunscreen FSA eligible?

Sunscreen is eligible for reimbursement with flexible spending accounts (FSA), health savings accounts (HSA), and health reimbursement accounts (HRA). They are not eligible for reimbursement with dependent care flexible spending accounts and limited-purpose flexible spending accounts (LPFSA).

Can you increase FSA contributions mid year?

To change your FSA contributions, complete and submit a Request for Change in Status form. In most plan years, certain qualified changes in status may provide an opportunity in which you may start or stop participating, or change the amount of your FSA contribution during the plan year.

Are FSA limits changing for 2023?

The IRS has increased the Flexible Spending Account (FSA) contribution limits for the Health Care Flexible Spending Account (HCFSA) and the Limited Expense Health Care FSA (LEX HCFSA). For 2023, participants may contribute up to an annual maximum of $3,050 for a HCFSA or LEX HCFSA.