Compliance Alert: Updates to 2023 Health FSA & Qualified Transportation Limits
… commuter benefits. These limits are adjusted annually for inflation. Limits for Dependent Care Assistance Programs (DCAP) are set by statute and not adjusted annually for inflation. Background In Revenue Procedure 2022-38, the IRS sets forth a variety of 2023 adjusted tax limits. Among other things, the notice indicates that employee contribution limits toward health FSAs and qualified transportation fringe benefits will increase for 2023. The limit on annual employee contributions toward health FSAs is $3,050 in 2023, with the ability to carryover up to $610. The limit on monthly contributions toward qualified transportation and parking benefits for 2023 …
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