On October 18, 2022, the IRS released Revenue Procedure 2022-38 announcing the adjusted contribution limits for health flexible spending accounts (Health FSAs), among other limits, for the 2023 calendar year.

The 2023 limits, as compared to the 2022 limits, are outlined below:

Health FSA$3,050$2,850
Maximum Health FSA Carryover Amount$610$570
Dependent Care FSA$5,000$5,000
Qualified Commuter/Parking Benefits$300$280
Adoption Assistance Tax Credit$15,950$14,890
Qualified Small Employer Health Reimbursement Arrangement (QSEHRA)$5,850 (single) / $11,800 (family)$5,450 (single) / $11,050 (family)

In addition, the annual changes to the Affordable Care Act (ACA) maximum out-of-pocket limits were released earlier this year by the Department of Health and Human Services (HHS) in the Notice of Benefit and Payment Parameters, and are shown below:

ACA Maximum Out-of-Pocket Limit$9,100 (single)/
$18,200 (family)
$8,700 (single)/
$17,400 (family)

As a reminder, the 2023 limits released this May in IRS Revenue Procedure 2022-24 for health savings accounts (HSAs) and high deductible health plans (HDHPs) are provided in our blog, Sequoia Foreword: IRS Releases 2023 HSA & HDHP Limits

Employer Action Item

  • Employers should ensure their systems, documents, and enrollment materials are updated with the 2023 limits.
  • Employers should notify their employees of the new 2023 limits.

Additional Resources

The information and materials on this blog are provided for informational purposes only and are not intended to constitute legal or tax advice. Information provided in this blog may not reflect the most current legal developments and may vary by jurisdiction. The content on this blog is for general informational purposes only and does not apply to any particular facts or circumstances. The use of this blog does not in any way establish an attorney-client relationship, nor should any such relationship be implied, and the contents do not constitute legal or tax advice. If you require legal or tax advice, please consult with a licensed attorney or tax professional in your jurisdiction. The contributing authors expressly disclaim all liability to any persons or entities with respect to any action or inaction based on the contents of this blog. © 2022 Sequoia. All Rights Reserved.

Tina Barile — Tina is a Client Compliance Consultant for Sequoia, where she works with our clients to optimize and streamline benefits compliance. In her free time, Tina enjoys being with family, cooking, reading, and playing sports.