2019 FSA Contribution Limit
For 2019, the FSA Contribution Limit figures are $2,700 (Health FSA salary reduction limit) and $500 (Maximum carryover).
Effective 2019-01-01Source: Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)Verified 2026-09-02
Compared with 2018
| Item | 2018 | 2019 | Change |
|---|---|---|---|
| Health FSA salary reduction limit | $2,650 | $2,700 | +$50 (+1.9%) |
| Maximum carryover | $500 | $500 | +$0 (+0.0%) |
Who it applies to
Employees who participate in employer-sponsored health flexible spending arrangements (FSAs) and make salary reduction contributions
What changed this year, and why
The health FSA salary reduction limit increased to $2,700 for 2019, up from $2,650 in 2018. The maximum carryover of unused FSA funds remained $500.
Common questions
- How much can I contribute to a health FSA through salary reduction in 2019?
- For 2019, salary reduction contributions to a health FSA are limited to $2,700 per year. This was an increase from $2,650 in 2018.
- Can unused FSA funds be carried over to the next year?
- Employers may allow employees to carry over up to $500 of unused health FSA amounts from one plan year to the next. This carryover amount was the same in 2018.
Self-employed people cannot have a health FSA
A Health Flexible Spending Arrangement is a benefit your employer sets up, typically as part of a cafeteria plan. Because the plan belongs to the employer rather than to you as an individual business owner, you cannot open one on your own. If you are self-employed - meaning you work for yourself as a sole proprietor, partner, or independent contractor - you are not eligible to participate in a health FSA, even if you would otherwise like to set aside pre-tax dollars for medical costs. The only way to have a health FSA is to be an employee of an employer that chooses to offer one. The employer also has full flexibility in how it designs the plan, including which combinations of benefits it makes available. Highly compensated employees and key employees may face additional limits once they do qualify. So the first step is always to check with your employer's benefits office to see whether a health FSA is offered and whether you meet the plan's eligibility rules.
Health FSAs are employer-established benefit plans. These may be offered in conjunction with other em- ployer-provided benefits as part of a cafeteria plan. Em- ployers have complete flexibility to offer various combina- tions of benefits in designing their plan. Self-employed persons aren’t eligible for FSAs.
Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)
You elect once a year and cannot change it at will
At the start of each plan year, you must elect a specific dollar amount to contribute to your health FSA through salary reductions. Your employer then deducts that amount periodically, usually every payday, based on your annual election. Once made, this election is generally irrevocable for the entire plan year. You cannot increase, decrease, or stop your contributions simply because your expenses changed or because you want to adjust your budget. The only exception is if you experience a qualifying change in employment or family status that the plan recognizes. If you get married, have a child, or change jobs, you may be allowed to modify your election. Outside of those specific events, your contribution amount is locked in for the year.
At the beginning of the plan year, you must designate how much you want to contribute. Then, your employer will de- duct amounts periodically (generally, every payday) in ac- cordance with your annual election. You can change or re- voke your election only if there is a change in your employment or family status that is specified by the plan.
Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)
The whole election is available on day one
One of the key features of a health FSA is that the full amount you elect to contribute for the year is available to you from the very first day of the coverage period, even if you have not yet contributed anything through payroll deductions. For example, if you elect to contribute $2,700 for the year, you can receive reimbursements up to that full $2,700 on January 1, regardless of how much has actually been withheld from your paycheck at that point. This is different from a savings account where you can only spend what you have deposited. The maximum amount you can receive tax-free is the total amount you elected to contribute for the year. This feature makes FSAs particularly useful for covering large, anticipated medical expenses early in the year.
You must be able to receive the maximum amount of reimbursement (the amount you have elected to contribute for the year) at any time during the coverage period, regardless of the amount you have actually contributed.
Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)
Use it or lose it, and the two escapes from it
Health FSAs are generally "use-it-or-lose-it" plans, meaning any amounts left in the account at the end of the plan year are forfeited and cannot be carried over to the next year. However, plans may offer one of two exceptions to this rule. First, a plan may provide a grace period extending beyond the end of the plan year, during which you can use remaining funds to pay for qualified medical expenses incurred in that period. Second, a plan may allow you to carry over up to $500 of unused amounts to the following plan year. The plan may specify a lower carryover amount if it chooses. Importantly, a plan may offer either the grace period or the carryover, but not both. Your employer is not permitted to refund any balance to you directly. This structure encourages participants to estimate their medical expenses carefully when making their annual election of $2,700 or less.
FSAs are generally “use-it-or-lose-it” plans. This means that amounts in the account at the end of the plan year generally can’t be carried over to the next year. However, the plan can provide for either a grace period or a carry- over.
Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)
What the money may be spent on, and what it may not
Money in a health FSA can only be used to pay for qualified medical expenses as defined by the plan and the Internal Revenue Code. These are generally the same expenses that would qualify for the medical and dental expenses deduction, as explained in Publication 502. Non-prescription medicines (other than insulin) do not count as qualified medical expenses for FSA purposes. A medicine or drug qualifies only if it requires a prescription, is available over-the-counter and you obtain a prescription for it, or is insulin. Qualified medical expenses include those incurred by you, your spouse, and all dependents you claim on your tax return. This means you cannot use FSA funds for non-medical purposes like gym memberships, vitamins, or cosmetic procedures unless they meet the specific definition of qualified medical expenses. The expenses must also be incurred during your coverage period under the plan.
Qualified medical expenses. Qualified medical expen- ses are those specified in the plan that generally would qualify for the medical and dental expenses deduction. These are explained in Pub. 502. Also, non-prescription medicines (other than insulin) aren’t considered qualified medical expenses for FSA pur- poses.
Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)
Only expenses from your period of coverage qualify for reimbursement
Under IRS rules for 2019, a health FSA will only reimburse qualified medical expenses that you incurred during your period of coverage under the plan. Expenses you incurred before your coverage began or after it ended do not qualify for reimbursement from that FSA. This is one reason the IRS encourages participants to base their salary-reduction contributions on a realistic estimate of the qualifying expenses they expect to have during the plan year. You must be able to receive the full amount you elected to contribute for the year at any time during the coverage period, regardless of how much you have actually contributed so far. For 2019, the salary-reduction limit for health FSA contributions is $2,700. Any amounts that remain unspent at the end of the plan year are generally forfeited, although some plans may allow a carryover of up to $500 or a short grace period, depending on the plan design.
Generally, distributions from a health FSA must be paid only to reimburse you for qualified medical expenses you incurred during the period of coverage.
Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)
Having a general-purpose health FSA generally rules out an HSA
Under IRS rules for 2019, if you are covered by a high deductible health plan (HDHP) and also by a general-purpose health FSA or HRA that pays or reimburses qualified medical expenses, you generally cannot make contributions to a Health Savings Account. The health FSA coverage disqualifies you from HSA eligibility because it provides benefits before the HDHP deductible is met. However, there are exceptions: you may still contribute to an HSA if you have a limited-purpose health FSA (which only reimburses dental, vision, preventive care, or long-term care) or a post-deductible health FSA (which only reimburses after the HDHP deductible is satisfied). These arrangements allow you to maintain HSA eligibility while still receiving some FSA benefits. If you are considering both a health FSA and an HSA, you need to structure your coverage carefully to avoid losing the ability to contribute to your HSA. The salary reduction limit for health FSA contributions in 2019 is $2,700.
An employee cov- ered by an HDHP and a health FSA or an HRA that pays or reimburses qualified medical expenses generally can’t make contributions to an HSA.
Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)
You cannot be paid ahead of the expense, or paid twice for it
Under IRS rules for 2019, a health FSA cannot make advance reimbursements of future or projected expenses. You can only receive reimbursement from your health FSA for expenses that have actually been incurred, not for expenses you expect to have later. This means you cannot request reimbursement for medical care you plan to receive in the future, even if you know you will have qualified expenses. The FSA also requires that you provide documentation showing the expense has been incurred and has not been paid or reimbursed under any other health plan coverage. This prevents double reimbursement - you cannot be paid twice for the same expense from different sources. For example, if your health insurance pays for a medical procedure, you cannot also get reimbursed for that same procedure from your health FSA. These rules ensure that FSA distributions are only used for actual, substantiated medical expenses incurred during your coverage period. The salary reduction limit for health FSA contributions in 2019 is $2,700.
The FSA can’t make advance reim- bursements of future or projected expenses.
Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Publication 969 (2019), Health Savings Accounts and Other Tax-Favored Health Plans (IRS)
- Health FSA salary reduction limit
For 2019, salary reduction contributions to a health FSA can’t be more than $2,700 a year (or any lower amount set by the plan).
- Maximum carryover
Plans may allow up to $500 of unused amounts remain- ing at the end of the plan year to be paid or reimbursed for qualified medical expenses you incur in the following plan year. The plan may specify a lower dollar amount as the maximum carryover amount.