Amendments needed to reflect $2,500 limit on Health FSA contributions by year endDecember 2014
As mentioned in a prior Alert, beginning in 2013 employees’ salary reduction contributions to a health flexible spending account (health FSA) may not exceed $2,500 per plan year. This limit is to be indexed for inflation in later years, and for 2015 has been increased by the IRS to $2,550. Although operational compliance was required beginning with the first plan year that began on or after January 1, 2013, plan sponsors have until December 31, 2014 to formally amend their health FSA arrangements to reflect the $2,500 contribution limit.
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