The Internal Revenue Service (IRS), on October 18, 2022, announced updated regulatory limits for FSA, Transit, and Adoption Assistance plans for 2023.
2023 FSA Limit
The maximum annual contribution for Health FSAs will be $3,050 for the 223 plan year, which is an increase from $2,850 in 2022.
There are no changes at this time for Dependent Care FSA limits, which remain at $5,000 for married filing jointly or head of household and $2,500 for married filing separately.
2023 FSA Carryover Limit
The annual FSA Carryover limit is indexed to the annual contribution limit at a rate of 20%. With the annual FSA limit increasing in 2023, the annual FSA Carryover limit is also increasing to $610, which is an increase from the $570 Carryover limit in 2022.
2023 Commuter Limits
The qualified transportation fringe benefit and monthly qualified parking benefits are both increasing to $300 per month for the 2023 plan year. This compares to $280 per month in 2022.
2023 Adoption Assistance Limit
The annual limit for employer-sponsored Adoption Assistance will be $15,950 in 2023. This compares to $14,890 for 2022.
For additional information, refer to IRS Revenue Procedure 2022-38.
