2027 Health FSA and Other Limits Announced
November 09, 2026
At A Glance
2027 IRS Benefit Plan Limits:
- Health FSA, including a Limited Purpose Health FSA: $3,500 per year
- Health FSA maximum carryover of unused amounts: $700 per year
- Qualified Transportation plans: $350 per month
- Qualified Parking plans: $350 per month
- Excepted Benefit HRA: $2,250 per year
- Qualified Small Employer HRA (QSEHRA): $6,700 per year for single coverage and $13,550 per year for family coverage
IRS Benefit Plan Limits
IRS Revenue Procedure 2026-35 provides annual inflation adjustments for more than 60 tax provisions, including contribution limits for Health Flexible Spending Accounts (FSAs) and reimbursement limits for Qualified Transportation fringe benefit plans and Qualified Small Employer Health Reimbursement Arrangements (QSEHRAs). The limits addressed in the procedure are increasing for 2027.
Additionally, Revenue Procedure 2026-24 states that the inflation-adjusted maximum dollar amount that may be made available for Excepted Benefit Health Reimbursement Arrangements (EBHRAs) in 2027 will increase to $2,250.
Health FSA, Transportation, QSEHRA and EBHRA Limits 2026 v. 2027 | |||
|---|---|---|---|
| Benefit Plan | 2026 | 2027 | Increase |
| Health FSA | $3,400 per year | $3,500 per year | + $100 |
| Health FSA Carryover | $680 per year | $700 per year | + $20 |
| Qualified Commuter and Transit Benefits | $340 per month | $350 per month | + $10 |
| Qualified parking | $340 per month | $350 per month | + 10 |
| Qualified Small Employer Health Reimbursement Arrangement (QSEHRA) | $6,450 per year for single coverage $13,150 per year for family coverage | $6,700 per year for single coverage $13,550 per year for family coverage | + $250
+ $400 |
| Excepted Benefit HRA (EBHRA) | $2,200 per year | $2,250 per year | + $50 |
Next Steps
With open enrollment season upon us, employers should review their open enrollment materials for accuracy and communicate any updates to employees. For open enrollment periods that have already ended, employers may want to offer a limited special enrollment period to allow participants to adjust their elections based on the updated limits.
Thank you for choosing Paylocity as your Payroll Tax and HCM partner. This information is provided as a courtesy, may change and is not intended as legal or tax guidance. Employers with questions or concerns outside the scope of a Payroll Service Provider are encouraged to seek the advice of a qualified CPA, Tax Attorney or Advisor.
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