Will your company be including a Flexible Spending Account (FSA) plan within its employee benefits program for 2017? If so, it’s important to note the the IRS has increased the annual contribution limit.
The IRS has set the FSA dollar limit on employee salary reduction contributions to $2,600 for taxable years beginning in 2017.
Steps That Employers May Take
Employers should ensure that their health FSA will not allow employees to make pre-tax contributions in excess of $2,600 for 2017, and they should communicate the 2017 limit to their employees as part of the open enrollment process.
An employer may continue to impose its own health FSA limit, as long as it does not exceed the ACA’s maximum limit for the plan year. This means that an employer may continue to use the 2016 maximum limit for its 2017 plan year.
While some of our clients have already printed materials for their 2017 Open Enrollment period, it’s not too late to take advantage of this increased limit.
Please contact our team if you need any help taking advantage of the expanded FSA contribution limit for 2017. You may reach us by phone at 781-759-1222.
For more information on FSAs, we encourage all clients to download the “Health FSA Limit Will Increase for 2017” Compliance Bulletin within the CBGconnect portal.