A health care FSA lets account holders use pre-tax dollars for medical expenses. Eligible expenses include deductibles, copays, dental, vision, prescriptions, and family members’ medical care, regardless of their health coverage. The 2023 FSA contribution limit will be $3,050, which is a $200 increase from 2022.

Health care FSA funds may generally be used to reimburse expenses incurred during the year, with any remaining balance forfeited. However, there is an exception that lets employees roll over unused health care FSA contributions to the next year—if the employer offers this option—without reducing the amount of contributions for the next year.

Earlier in 2022, the IRS announced that the maximum rollover limit for health care FSAs was increased from $570 to $610.

Learn more about health care FSAs.

Commuter benefits, also known as known as qualified transportation fringe benefits, allow users to set aside pre-tax dollars for work transportation costs, including fare cards, vouchers, and shared rides. The 2023 commuter benefit contribution limit will be $300, a $20 increase from 2022.

Learn more about commuter benefits.

Adoption assistance gives employees tax relief when they are adopting a child. For 2023, the amount that can be excluded from an employee’s gross income for the adoption of a child is $15,090. This is $1,060 more than in 2022, when it was $14,890.

Learn more about adoption assistance.