The Internal Revenue Service (IRS) released Revenue Procedure 2025-32 on October 9, 2025, outlining cost-of-living adjustments for health care flexible spending accounts (FSA), commuter, and adoption assistance program benefits for the 2026 taxable year.
The table below details the 2026 maximum limit amounts for these benefits (along with other plan limits announced earlier in the year, detailed here, here, and here), compared to the current 2025 limits.
Employers are advised to:
|
Health & Welfare Plan Limits |
2026 |
2025 |
Change from 2025 |
|
|---|---|---|---|---|
|
Health Care Flexible Spending Account (HC FSA) maximum contribution limit |
$3,400 |
$3,300 |
+$100 |
|
|
Health Care Flexible Spending Account (HC FSA) maximum carryover amount |
$680 |
$660 |
+$20 |
|
|
Dependent Care Flexible Spending Account (DC FSA) maximum contribution limit |
Single individuals or married individuals filing jointly |
$7,500 |
$5,000 |
+$2,500 |
|
Married individuals filing separately. |
$3,750 |
$2,500 |
+$1,250 |
|
|
Health Savings Account (HSA) maximum contribution limit* * Includes both employee and employer contribution amount limits. |
Self-only coverage |
$4,400 |
$4,300 |
+$100 |
|
Family Coverage |
$8,750 |
$8,550 |
+$200 |
|
|
Health Savings Account (HSA) catch-up contribution limit |
Age 55 or older |
$1,000 |
$1,000 |
No change |
|
High-Deductible Health Plan (HDHP) minimum deductible |
Self-only coverage |
$1,700 |
$1,650 |
+$50 |
|
Family coverage |
$3,400 |
$3,300 |
+$100 |
|
|
High-Deductible Health Plan (HDHP) out-of-pocket maximum amount* *Includes deductibles, copayments and other amounts, but excluding premiums. |
Self-only coverage |
$8,500 |
$8,300 |
+$200 |
|
Family coverage |
$17,000 |
$16,600 |
+$400 |
|
|
ACA Compliant Plans* cost-sharing maximum limit * The Affordable Care Act (ACA) requires health plans to place annual limits on participants’ cost sharing for essential health benefits (EHBs). |
Self-only coverage |
$10,600 |
$9,200 |
+$1,400 |
|
Family coverage |
$21,200 |
$18,400 |
+$2,800 |
|
|
Excepted Benefit Health Reimbursement Arrangement (EBHRA)* maximum amount *Employers offer EBHRAs to reimburse the cost of excepted benefits (such as limited-scope dental or vision coverage) as well as short-term, limited-duration insurance plan premiums. |
$2,200 |
$2,150 |
+$50 |
|
|
Qualified Small Employer Health Reimbursement Arrangement (QSEHRA) maximum amount |
Self-only coverage |
$6,450 |
$6,350 |
+$100 |
|
Family Coverage |
$13,100 |
$12,800 |
+$300 |
|
|
Commuter Benefit Limit |
2026 |
2025 |
Change from 2025 |
|---|---|---|---|
|
Qualified transit and parking maximum contribution limit[1] |
$340 |
$325 |
+$15 |
|
Adoption Assistance Program Limit |
2026 |
2025 |
Change from 2025 |
|---|---|---|---|
|
Adoption assistance program[2] maximum contribution limit (including for the adoption of a child with special needs) |
$17,670[3] |
$17,280 |
+$390 |
Please reach out to your Risk Strategies account team with any questions, or contact us directly here.
[1] Internal Revenue Code (IRC) Section 132(f) permits employers to offer a qualified transportation benefit program to their employees on a tax-free basis through a compensation reduction agreement.
[2] Under IRC Section 137, amounts paid by an employer (subject to dollar limits and other requirements) for “qualified adoption expenses” incurred in connection with the adoption (or in certain cases, the unsuccessful attempted adoption) of a child are excludable from an employee's gross income if furnished pursuant to an “adoption assistance program” of the employer.
[3] For 2026, the amount excludable from an employee's gross income begins to phase out under IRC Section 137(b)(2)(A) for taxpayers with modified adjusted gross income of more than $265,080 and is completely phased out for taxpayers with modified adjusted gross income of $305,080 or more.