The IRS announced that the maximum FSA contribution limit for 2022 will be $2,850, an increase of $100 from 2021.
The limit is based on the employee and not the household. If an employee and spouse both have access to their own FSA through their respective employers, they are each eligible to contribute up to the $2,850 maximum into their respective FSA.
- The American Rescue Plan Act of 2021 (ARPA) passed in March 2021 allowed for a Dependent Care FSA temporary increase to $10,500. Without legislative action, plans will revert back to the $5,000 Dependent Care FSA limit in 2022
- The Adoption Assistance limit will increase from $14,400 in 2021 to $14,890 in 2022
- The maximum monthly pre-tax Commuter Benefit limit for mass transit and parking will increase from $270 in 2021 to $280 in 2022
There is no requirement to increase Medical FSA or Adoption Assistance limits. Employers must initiate a change. By contrast, mass transit, parking, and HSA limits will be updated automatically for elections intended on or after January 1, 2022.
More information can be found at: https://www.irs.gov/pub/irs-drop/rp-21-45.pdf