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  • 2013 FSA Limits Announced

      Health care reform legislation imposed a new, $2,500 limit on annual contributions to health care flexible spending accounts (FSAs). This limit applies to all FSA plans in taxable years beginning after Dec. 31, 2012 — even plans grandfathered under other provisions of health care reform.

    Plans that currently allow a health care FSA election of more than $2,500, must amend plan documents before Jan. 1, 2013, and change employee communications.

    To simplify administration of this change, sponsors of non-calendar year plans may want to adopt the new limit as of the first day of the plan year rather than waiting until Jan. 1, 2013. For example, if the current plan year begins May 1 and ends April 30, the plan sponsor may:

    • Communicate the change to employees.
    • Amend their plan documents to implement the new $2,500 maximum election.
    • Initiate  the changes to the contribution effective May 1, 2012, rather than wait until the mid-plan year in Jan. 1, 2013

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