IRS Announces NEW FSA Maximums for 2020
11.07.19
The IRS released the 2020 annual inflation adjustments. Effective January 1, 2020, the new annual Health Care FSA maximum contribution will increase to $2,750. The new monthly maximum contributions for Qualified Transportation plans will be $270.
Here’s a look at some of the other important limits:
YEARS | 2020 | 2019 |
Health FSA Max Election | $2,750 | $2,700 |
Dependent Care FSA Max Election | $5,000 | $5,000 |
Parking | $270/mo | $265/mo |
Mass Transit | $270/mo | $265/mo |
HDHP Min Annual Deductible – Single | $1,400 | $1,350 |
HDHP Min Annual Deductible – Family | $2,800 | $2,700 |
HDHP Out of Pocket Max – Single | $6,900 | $6,750 |
HDHP Out of Pocket Max – Family | $13,800 | $13,500 |
HSA Max Contribution Limit – Single | $3,550 | $3,500 |
HSA Max Contribution Limit – Family | $7,100 | $7,000 |
HSA Catch-Up Contribution Limit | $1,000 | — |
401(k) Retirement Plans | $19,500 | $18,500 |
Administratively, the timing of the announcement represents a challenge for employers that have already completed their January 1, 2020 annual enrollment periods or are well into their enrollment efforts. Available options to explore include the following:
To those still “planning the plan”, these increases can be folded into your base communications, enrollment processes and key open enrollment messaging. We have great resources available to assist in your communication strategy. If you’re looking to do some education, or have any questions, contact your dedicated account team for additional resources.
The information provided here is of a general nature and is not intended to address the specific circumstances of any individual or entity. In specific circumstances, the services of a professional should be sought. Tax information, if any, contained in this communication was not intended or written to be used by any person for the purpose of avoiding penalties, nor should such information be construed as an opinion upon which any person may rely. The intended recipients of this communication and any attachments are not subject to any limitation on the disclosure of the tax treatment or tax structure of any transaction or matter that is the subject of this communication and any attachments.