During Open Enrollment season, it’s important for individuals to know the 2017 contribution limits for Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs).
Here’s a quick guide to next year’s contribution limits and other important information:
Flexible Spending Account (FSA)
In October 2016, the IRS released its inflation adjustments which raised the limits for healthcare FSAs. In 2017, the annual FSA contribution limit is increasing by $50 from the previous year. Employees with this employer-sponsored benefit account can contribute a maximum of $2,600.
FSA carryover limits remain the same at $500.
Dependent Care FSA, also known as Dependent Care Assistance Plan (DCAP), limits remain at $5,000 for single, head of household, or married filing jointly, or $2,500 each for married filing separately.
See the chart below for 2017 FSA contribution and carryover limits.
2017 Contribution Limits for FSAs
|Maximum Healthcare FSA Contribution||Healthcare FSA Carryover Limit||Maximum DCAP Election
(Single, Head of Household, or Married Filing Jointly)
|Maximum DCAP Election
(Married Filing Separate)
*Note: FSA contributions are fixed once the plan year starts. Individuals cannot change their annual elections until the following enrollment season.
Health Savings Account (HSA)
In May 2016, the IRS released new Health Savings Account Guidelines for contribution limits in 2017. The only change from 2016 to 2017 is that individuals will see an increase of $50 to their contribution limits, which raises the limit from $3,350 to $3,400 for their HSAs; families will not see an increase.
HSAs, unlike FSAs, have no limits on annual carryover and there is no ‘use it or lose it’ policy.
See the chart below for 2017 contribution limits, minimum annual deductibles, and out-of-pocket expense limits for HSAs.
2017 Contribution Limits, Deductibles, and Out-of-Pocket Expenses for HSAs
|Individual Coverage||Family Coverage|
|Minimum annual deductible||$1,300||$2,600|
*Note: HSA contributions may be modified at any time during the plan year. Contact your benefits administrator if you need to discuss changing your annual contribution.
Health Reimbursement Arrangement (HRA)
Limits for Health Reimbursement Arrangements (HRAs) vary by employer. If your company offers an HRA, contact your HR representative to learn more.