IRS Makes Cost-of-Living Adjustments for HRAs and FSAs

IRS Makes Cost-of-Living Adjustments for HRAs and FSAs

10/26/2017

 

The IRS has announced tax year 2018 cost-of-living adjustments for inflation for more than 50 tax provisions, including increasingly contribution limits slightly for Qualified Small Employer HRAs and FSAs. HSA limits had been announced by the IRS back on May 4, 2017, as part of the  Revenue Procedure 2017-37, which included inflation-adjusted HSA contribution limits effective, along with minimum deductible and maximum out-of-pocket expenses for the high-deductible health plans (HDHPs) that HSAs must be coupled with.

 

The latest changes for the HRA, FSA and other healthcare accounts are detailed in the IRS Revenue Procedure 2017-58 and Notice 2017-64, but a summary of the health account impacts most relevant to WEX Health partners is provided below. This information has also been updated in the WEX Health 2018 Contribution Limits Numbers You Need to Know document, which is available for WEX Health Partners on Partner Central\Marketing Resources.

 

 

 Healthcare Flexible Spending Account (FSA)

2017 2018

Maximum Annual Contribution Limit

Limit on voluntary employee salary reduction contributions to a
health FSA (flexible spending account) (Section 3.16 of Rev. Proc. 2017-58)

$2,600 $2,650

 

QSEHRAs

2017

2018

Qualified Small Health Reimbursement Arrangements (QSEHRAs) limit
Maximum reimbursement from a qualified small employer (Section 3. 56 of Rev. Proc. 2017-58)

Individual coverage

$4,950 $5,050

Family coverage

$10,000 $10,250

 

 

Transit Benefits 2017 2018
Monthly limit on fringe benefit exclusion for commuter & parking (Section 3.17 of Rev. Proc. 2017-58)
Parking – monthly limit $255 $260
Transit and Vanpooling – monthly limit $255 $260

 

 

 Health Savings Accounts (HSA) 2017 2018
Minimum deductible amounts for the qualifying high deductible health plan (HDHP)
Individual coverage $1,300 $1,350
Family coverage $2,600 $2,700
Maximum contribution levels
Individual coverage $3,400 $3,450
Family coverage $6,750 $6,900
Catch up allowed for those 55 and over $1,000 $1,000
Maximums for HDHP out-of-pocket expenses
Individual coverage $6,550 $6,650
 Family coverage $13,100 $13,300