Flexible spending account contribution limits in 2022 have increased, which is good news if you’re contributing to an FSA this year. If you need to know about the new 2022 FSA limits, here’s what you should know.

What is an FSA?

Just to recap, a flexible spending account or FSA is an account that you put money into to cover certain out-of-pocket healthcare costs. You don’t pay taxes on the money you put into an FSA, which means you reduce your overall taxable income. Some employers may also make contributions to your FSA, but they aren’t required to.

To use your FSA funds, you first have to pay the expenses out-of-pocket, and then you submit a claim through your employer along with proof of the healthcare expense and documentation that it was not covered by your health insurance policy. Then, you’ll be reimbursed with funds from your FSA for your out-of-pocket costs.

What are the 2022 flexible spending account contribution limits?

Last year (2021), individuals were only allowed to contribute $2,750 to their FSA. This year, flexible spending account contribution limits have increased by a decent amount. In 2022, individuals can now contribute $2,850 to their FSA. If you’re just now hearing about this, it may be too late for you to take advantage of the limit increase. However, you can still look into switching things up for the upcoming open enrollment. For more information about flexible spending account contribution limits, visit the website.

In addition to an increase in flexible spending account contribution limits, individuals can also carry over a maximum of $570 for health FSA accounts that allow unused funds to roll over into the next year. That total has also increased from $550 last year in 2021.

How to sign up for a flexible spending account

For those without FSAs, these recent increases in contribution limits and rollover amounts may highlight the benefits of having a flexible spending account. If you don’t have an FSA but you’d like to learn more about the options available to you, you can reach out to your employer for more details. Your employer can also help you sign up for one if you decide it’s the right thing for you and your family.

Read a similar article about health savings account companies here at this page.