- Annual maximums:
- Medical - $3,200 (2024) $3,300 (2025) May be indexed for CPI in future years. The maximum limit is per employee per year. Spouses who both have access to the Medical FSA can each take advantage of the maximum limit. There is no family limit. If employee changes employers, he or she could have another maximum limit in the same tax year.
- Dependent Care - $5,000 (2024 & 2025) The maximum is a household limit. Spouses who file a joint tax return cannot exceed the $5,000 maximum together.
- Uniform Coverage: The entire Medical FSA election must be available on the first day of the plan year. This rule does not apply to Dependent Care.
- Funds elected by FSA participants, but unused at the end of the year, will be forfeited.
- Medical FSA Carryover (optional) allows up to $640 maximum per year (2024) $660 (2025) and may be indexed for CPI in future years. A plan cannot have grace period at the same time as offering the Medical FSA Carryover.
- Grace Period (optional) – A plan may allow expenses incurred up to 2 ½ months after the end of the plan year to be reimbursed from the prior year balance (employee/participant must be active in the plan on the last day of the plan year, including those who are covered under COBRA.)
