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Health FSA Limit Will Increase for 2022

On November 10, 2021, the Internal Revenue Service (IRS) announced that the health (flexible spending account (FSA)) dollar limit on pre-tax salary reduction contributions will increase to $2,850 for 2022 (it was $2,750 in 2021). In addition to this increase, the carryover limit for a health FSA has increased to $570.

Employers are still able to impose their own dollar limit on employees’ salary reduction contributions as long as it does not exceed the Affordable Care Act’s (ACA) maximum limit. It is important that employers communicate the 2022 limit to their employees during the open enrollment process.

Read the Legal Update.

Contact your Cowden representative for more information on this or other compliance issues.