Maximum Contribution on Health Care FSA vs. Dependent Care FSAs?

Question

My understanding is that a couple that is married and filing jointly can put a combined maximum of $5,000 into a dependent care FSA.    A person who is single can also contribute a maximum of $5,000.

Let's say that a couple is married and filing jointly and that each has access to a health care FSA.  Is the maximum combined contribution $5,000 or $10,000?

In other words, is a married person who has a health care FSA limited in the same way that they are with dependent care FSAs?

BAM · Accepted Answer

The combined maximum is $5,000.

Jim · Answer

The way the question is phrased and the answers may need some clarification or updating.  The question, as I read it, asks if married couples filing jointly can each contribute the maximum to a healthcare FSA, as they cannot for  dependent care FSA.

I believe for a Healthcare FSA, the answer is yes, each employee can contribute the maximum--for 2017 calendar year that is $2600, or $5200 combined.

Sundar · Answer

The maximum is $5,000. The advice of the "financial experts" is "wrong". Review IRS publication 503, on page 9 of the 2013 edition it says "If your employer provides dependent care benefits under a qualified plan, you may be able to exclude these benefits from your income." Your flexible spending account is one such plan. There are a number of limitations to the amount you can exclude and one of them is $5,000. The details are in that section. I use TurboTax to do my taxes and it caught this issue some years ago.

Note - since the money in FSA is not included in your taxable wages it is a "benefit". If the FSA amount was included by your employer in your taxable wages, it would not be "benefit".

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Maximum Contribution on Health Care FSA vs. Dependent Care FSAs?

3 Answers