Compliance Alert by: The Baldwin Regulatory Compliance Collaborative (BRCC)
IRS Announces 2023 Contribution Limits for Health Care FSAs
On October 18, 2022, the IRS released Revenue Procedure 2022-38, which provides increased limits for health care flexible spending account (FSA) contributions and related carryover amounts of $3,050 and $610, respectively, for the 2023 plan year (up from the 2022 limits of $2,850 and $570, respectively). In addition, the limit for 2023 qualified transit and parking expenses (which represent the non-taxable limits for employer-provided commuter benefit programs), increases to $300 (up from $280 in 2022).
The following is a reference tool for employers that summarizes 2023 limits applicable to health and welfare plans that are reflected either in Revenue Procedure 2022-38 or earlier guidance. Also included are the 2023 contribution limits required by employers subject to the San Francisco Health Care Security Ordinance (SFHCSO).
[1] Covered employers are required to make a minimum health care expenditure for most of their employees who work at least 8 hours per week within the geographic boundaries of the City. For 2023, managerial, supervisory and confidential employees earning more than $114,141 yr. (or $54.88/hr.) are exempt (for 2022, the exemption thresholds were $109,643/yr., or $52.71/hr.)
ADDITIONAL INFORMATION
For questions regarding this update or any other related compliance issues, please contact your Benefits Consultant.
The Baldwin Regulatory Compliance Collaborative
This Legislative Update was prepared by the Baldwin Regulatory Compliance Collaborative (the “BRCC”), a partnership of compliance professionals offering client support and compliance solutions for the benefit of the Baldwin Risk Partners organization, which includes: Jason Sheffield, BRP National Director of Compliance; Richard Asensio, Burnham Benefits Insurance Services; Nicole L. Fender, the Capital Group; Bill Freeman, AHT Insurance; Stephanie Hall, RBA/TBA; Caitlin Hillenbrand, AHT Insurance; Paul Van Brunt, Baldwin Krystyn Sherman Partners (BKS); and Natashia Wright, Insgroup.
