Flexible Spending Account (FSA), Qualified Transportation Fringe Benefits (“Commuter Benefits”), and Adoption Assistance limits for 2020 have been by adjusted for inflation by the Internal Revenue Service (IRS). To assist employers, brokers, and account holders, ConnectYourCare, a national leader in consumer-directed, tax-advantaged account solutions, is announcing the 2020 limits.
Health Care FSA – The monetary limit on employee pre-tax salary reduction contributions will increase to $2,750, up from $2,700 in 2019, according to the IRS.
Commuter Benefits – The IRS will allow $270 per month, pre-tax, to be excluded from an employee’s income for qualified parking benefits, up from $265 per month in 2019. Additionally, the combined monthly limit for transit passes and vanpooling expenses for 2020 will be $270, also up from $265.
Adoption Assistance – For adoption of a child, the maximum amount that may be excluded from an employee’s gross income under an employer-provided adoption assistance program will increase to $14,300 for 2020, up from $14,080 in 2019. The IRS noted that the exclusion, however, will begin to be phased out for individuals with modified adjusted gross incomes exceeding $214,520, and will be entirely phased out for individuals with modified adjusted gross incomes of $254,520 and greater.
“These annual increases to contribution limits help to ensure that Health Care FSAs, Adoption Assistance programs, and Transit and Parking programs remain attractive benefits to plan sponsors and participants,” said ConnectYourCare Chief Executive Officer, Steve Grieco.
For more information, see the IRS revenue procedure at https://www.irs.gov/pub/irs-drop/rp-19-44.pdf.
As a consumer-directed health care pioneer and nationally recognized industry leader, ConnectYourCare delivers a comprehensive solution supporting health care savings accounts and expanded tax-advantaged offerings. Through continuous evolution, highly rated service, and domain expertise across the benefits, banking, and payments spectrum, we are revolutionizing the connection between health and wealth. ConnectYourCare creates greater participant value through intuitive account management; greater employer value and savings through dynamic, outcome-based workflows and tools; and greater partnership value through deep engagements to meet goals—with proprietary, cloud-based technology and a modern, intelligent platform as its foundation.
Trusted by leading organizations, spanning all industries and sizes, we are making it easier for people to manage care, so they can enjoy life. For more information, visit ConnectYourCare.com or follow us on Twitter @ConnectYourCare.