The IRS announced the 2024 cost of living adjustments that apply to health flexible spending account maximum contributions (as well as other limits):
- Maximum employee contributions are $3,200. This is up by $150 from the 2023 limit.
- Maximum carryover amount is $640. This is up by $30 from the 2023 limit
For cafeteria plans that incorporate the statutory dollar limit, this means an automatic increase in the limits for health flexible savings account contributions. For cafeteria plans that have the contribution limits “hardwired” in the plan documents, amendments would be necessary to provide for this increase in limits.
Also of note, the limit for adoption assistance programs under Code Section 137 and the adoption credit under Code Section 23 will be $860 higher in 2024, at $16,810; and the qualified transportation fringe benefit limits under Code Section 132(f) will be $315, up $15 from 2023.