IRS Increases FSA Contribution Limit for 2019
The Internal Revenue Service issued Revenue Procedure 2018-57. This ruling increased the Health Care FSA limit to $2,700, an increase of $50 over the 2018 limit of $2,650, for plan years beginning on or after January 1, 2019.
The monthly limit on the value of the qualified transportation benefits exclusion for qualified parking provided by an employer to its employees for 2019 increased to $265, from the $260 limit in 2018. The monthly limit for transportation in a commuter highway vehicle and transit pass provided by an employer to its employees also increased to $265 for 2019, an increase of $5 from the 2018 limit of $260.
The amount that can be excluded from an employee’s gross income for the amounts paid or expenses incurred by an employer for qualified adoption expenses under an adoption assistance program for adoptions by the employee is $14,080.
Employers are not required to adopt the maximum but may choose a lower amount; as most employers are wrapping up or in the midst of open enrollment based on the previous $2,650 limit will want to consider whether and when to adopt the higher limit and how to communicate that change to employees.