<img height="1" width="1" src="https://www.facebook.com/tr?id=765055043683327&amp;ev=PageView &amp;noscript=1">

Complete List of 2023 IRS Contribution Limits For Tax-Advantaged Employee Benefit Programs

David Rook

The IRS has finally announced adjustments to 2023 contribution limits on various tax-advantaged health and dependent care spending accounts, retirement plans, and other employee benefits such as adoption assistance and transportation benefits. Many of these contribution limits, though not all, are indexed to cost-of-living adjustments.

Together, these combined announcements by the IRS detail 2023 adjusted limits to the amounts employees can tuck away pretax into Flexible Spending Accounts (FSAs), Health Savings Accounts (HSAs), transportation benefits, and retirement plans such as 401(k)s.

While IRS limits for HSAs and HDHPs are required, by law, to be announced by June 1st, limits for these other pretax savings vehicles always seem to come so late in the year that many employers have already completed their employee benefits open enrollments.

Employers who have already completed open enrollment for 2023 have two choices when it comes to communicating these updates; 1) they can do nothing, since there isn't an obligation to make the maximum election amounts available to employees, or 2) they can reopen the enrollment process and let employees who want to increase their elections do so before December 31st, for calendar year plans.

What follows is a consolidated summary of the new IRS limits;

Read More
Topics: Compliance, Employee Communications, HSAs, Retirement Planning, HDHPs, FSAs

Related posts

2022 IRS Contribution Limits For Tax-Advantaged Employee Benefit Programs (Consolidated)

Jeff Griffin

The IRS has finally announced adjustments to 2022 contribution limits on various tax-advantaged health and dependent care spending accounts, retirement plans, and other employee benefits such as adoption assistance and transportation benefits. Many of these contribution limits, though not all, are indexed to cost-of-living adjustments.

Together, these combined announcements by the IRS detail 2022 adjusted limits to the amounts employees can tuck away pretax into Flexible Spending Accounts (FSAs), Health Savings Accounts (HSAs), transportation benefits, and retirement plans such as 401(k)s.

While IRS limits for HSAs and HDHPs are required, by law, to be announced by June 1st, limits for these other pretax savings vehicles always seem to come so late in the year that many employers have already completed their employee benefits open enrollments.

Employers who have already completed open enrollment for 2022 have two choices when it comes to communicating these updates; 1) they can do nothing, since there isn't an obligation to make the maximum election amounts available to employees, or 2) they can reopen the enrollment process and let employees who want to increase their elections do so before December 31st, for calendar year plans.

What follows is a summary of the new IRS limits;

Read More
Topics: Compliance, Employee Communications, HSAs, Retirement Planning, HDHPs, FSAs

Related posts

2021 IRS Contribution Limits For HSA, HDHP, FSA, 401(k), QSEHRA, Adoption and Transportation

Jeff Griffin

The IRS recently finalized adjustments to 2021 contribution limits on various tax-advantaged health and dependent care spending accounts, retirement plans, and other employee benefits such as adoption assistance and qualified transportation benefits. Many of these contribution limits, though not all, are indexed to cost-of-living adjustments.

Together, these annual announcements by the IRS detail any adjusted limits to the amounts employees can tuck away pretax into Flexible Spending Accounts (FSAs), Health Savings Accounts (HSAs), Commuter Benefits, and Retirement Plans such as 401(k)s for the upcoming year.

While IRS limits for HSAs are required, by law, to be announced by June 1st, limits for these other pretax savings vehicles always seem to come so late in the year that many employers have already completed their employee benefits open enrollments.

As frustrating as this is, employers would be well-served to get this information out to their employees so they can take full advantage of these pretax savings vehicles. That said, there are not all that many changes for 2021.

What follows is a summary of limits employers and employees need to know.

Read More
Topics: Compliance, Employee Communications, HSAs, Retirement Planning, HDHPs, FSAs

Related posts

IRS Provides Relief to Those with Overfunded FSAs

Jeff Griffin

With daycare centers closed and summer camps turning kids away, employees who socked away money in their Dependent Care Flexible Savings Accounts (DCFSAs) are worried their use-it-or-lose-it account balances are going down the drain.

This concern is also shared by those who tucked away pre-tax savings in Health Care Flexible Savings Accounts (HCFSAs) to cover eligible health care expenditures. With hospitals postponing elective procedures and patients skittish about entering health care facilities, savers simply aren't racking up enough receipts to deplete their FSA balances.

Both groups can now breathe a sigh of relief, since new guidance from the IRS will allow most employees to make midyear pre-tax contribution adjustments to their Health Care and Dependent Care FSAs, which typically aren't permitted once enrollment elections are set.

Historically, the only exception to this rule was if an employee experienced a Qualifying Life Event (QLE), defined by the IRS as a marriage, divorce, job change, birth or adoption of a child, or when a dependent child reaches age 26.

In addition to allowing midyear savings account adjustments, the IRS is also permitting midyear health plan enrollment changes.

Read More
Topics: Legislation, HSAs, FSAs, COVID-19

Related posts

IRS Finally Announces Official Contribution Caps For FSAs, 401(k)s, HSAs and More (Includes Comparison Tables)

Jeff Griffin

This afternoon the IRS officially announced the final 2020 election/contribution limits for Flexible Spending Accounts (FSAs), qualified Commuter Benefits, and several retirement savings vehicles. (See comparison tables, below.)

Considering that many employers have already held their employee benefits Open Enrollments for 2020, today’s announcements by the IRS can best be filed under the “better late than never” category.

These IRS statements finally set official contribution limits for Health Care FSAs, Dependent Care FSAs, Limited Purpose FSAs, Qualified Parking and Qualified Transportation Saving Plans, 401(k)s, 403(b)s, most 457 plans, IRAs, SIMPLE Plans, and the Federal Government’s Thrift Savings Plan.

All of these saving plans provide participants with the opportunity to save money, either by paying for qualified expenses with pre-tax savings contributions, or by saving for retirement with pretax elections. 

Read More
Topics: Compliance, Employee Communications, HSAs, Retirement Planning, HDHPs, FSAs

Related posts

Active vs. Passive Open Enrollment; Weighing the Pros & Cons

David Rook

Employers who offer health benefits are  required each year to hold a benefits enrollment "window", commonly referred to as an open enrollment period. 

During open enrollment, employees can renew, adjust, or waive benefit options. Outside of a Qualifying Life Event, open enrollment is essentially the only time an employee can make changes to most (though not all) of their benefits. 

While an employer is required, by law, to hold an open enrollment, what's not defined is whether the enrollment needs to be structured as "active" or "passive". A passive enrollment period is one where an employee's benefit selections from the previous year simply roll-over and/or auto-migrate (within reason) to similar options. An active enrollment, on the other hand, requires an employee to elect, renew, adjust, and sometimes actively decline benefit elections. (The SPD and other plan documents will usually spell out these rules for employees.)

In a nationwide survey conducted by the JP Griffin Group this April, 2019 amongst full-time, benefit-eligible employees in the U.S., 50 percent (half) reported participating in a passive enrollment this year. Compared to a 2011 survey of employers, where 71% reported holding passive enrollments, these new findings represent a 30% decrease in the number of companies conducting their open enrollments passively.

Read More
Topics: HSAs, passive enrollment, open enrollment, active enrollment, Strategy, FSAs, 401(k)s

Related posts

Rollovers, Grace Periods and Run-Outs: Important FSA Terms for Early in the Calendar Year

Jeff Griffin

There are three key FSA-related terms that every company which offers flexible spending accounts to their employees should review around this time of year.

While human resources professionals likely are well-aware of what FSA rollovers, grace periods and run-out periods are, employees frequently don’t know the difference between these (and sometimes don’t know they exist at all).

Rollovers: Letting Employees Use Some Previous Funds This Year

Rollovers are an optional feature that the IRS made available starting in plan year 2013 (plan year 2014 for plans with grace periods). Despite being strictly an optional feature that employers can elect or not elect to offer, rollovers have been widely adopted since they were first made available. Only 8 percent of employers who had FSA plans offered the option early on, but by 2015 it was adopted by 60 percent of employers with plans.

Read More
Topics: FSAs

Related posts

2019 IRS Limits for Commonly Offered Employee Benefits

Jeff Griffin
The IRS recently finalized adjustments to 2019 limits on various tax-advantaged medical and dependent care spending accounts, retirement plans, and other inflation-adjusted employee benefits such as adoption assistance and qualified transportation benefits.
 
The 2.2 percent increase in the Consumer Price Index (PCI) for the 12 months ending this September was just enough to meet the thresholds required to extend these rate adjustments.
 
Despite some of these updates being issued nearly a month later than normal, these new financial caps still go into effect January 1, 2019. While some of the limits are unchanged, many have increased for 2019, affording employees the opportunity to contribute more money into their Health Spending Accounts (HSAs), Flexible Spending Accounts (FSAs), and retirement plans, just to name a few.
 
In preparation for these 2019 plan year changes, employers should update their benefit plan designs for the new limits, ensure that their plan administration will be consistent with the new 2019 limits, and communicate the new benefit plan limits to their employees. 
 
Here is a convenient set of side-by-side comparison tables outlining the changes:
 
Tax-Advantaged Employee Benefits
HSA & HDHP Contribution Limits
The IRS has increased the 2019 annual HSA contribution limit for self-only HDHP coverage by $50, to $3,500, and by $100, to $7,000, for family HDHP coverage. HSA contributions can be made by the HSA account holder or any other person on their behalf, including an employer or family member.
 
 
Read More
Topics: Compliance, Education, HSAs, Retirement Planning, Savings Plans, QSEHRA, HDHPs, FSAs

Related posts

Three Ways for Employees & Employers to Save Money on Healthcare

David Rook

Recent news that the rising cost of healthcare in America may actually be slowing is being met with resounding elation by those looking for ways to save money on their medical insurance. For those with high deductible health plans (HDHPs) and other forms of consumer-driven healthcare, this comes as especially welcome news.

If sustained, this tempering of rising medical care costs will hopefully begin to curb an alarming trend, that being dangerous cost-avoidance practices by some covered individuals, which sometimes includes such dangerous practices as skipping medications and postponing necessary medical procedures. (Many have also skipped out on preventative care, despite the fact that most all of it is covered at 100%.)  While in the short-term such actions will indeed bring down healthcare expenses, they are likely to trigger larger problems later on, which cost far more money.

There are much safer and more effective ways to curb healthcare expenses, but it takes a bit of effort and education to capitalize on them. Here are just a few we’ve found. Please feel free to use these money saving strategies with your workforce — and better yet — try them out yourself.

Read More
Topics: Employee Benefits, HSAs, CFO, employers, CHRO, cost management, Consumer Driven Healthcare, FSAs

Related posts

Instant Blog Alerts

Straight to Your Inbox

Most Read

Posts by Topic

Expand all
Free_White_Paper_Employee_Benefits_Branding
Free_White_Paper_Private_Exchange_Employee_Benefits
Free_White_Paper_Employee_Benefits_Branding
Free_White_Paper_Employee_Benefits_Hospitality
Free_White_Paper_Improving_Employee_Benefits_Communications
Free_White_Paper_Employee_Benefits_Construction
Free_White_Paper_Employee_Benefits_Branding