FSA Limits 2027: Health FSA, Carryover and Dependent Care
The IRS confirms the 2027 health FSA limit in its annual revenue procedure, usually in October or November. The dependent care FSA limit is already fixed by law at $7,500 ($3,750 if married filing separately). Computed from the statute, the health FSA limit should be $3,500, and our formula matches every official limit from 2014 to 2026.
Maintained by Archie Chang · Limits computed from statute and BLS data October 18, 2026 · Methodology & sources
2027 FSA limits at a glance
| Limit | 2027 | Status | 2026 |
|---|---|---|---|
| Health FSA salary reduction (also limited-purpose FSA) | $3,500 | Computed; IRS confirms in its annual revenue procedure | $3,400 |
| Carryover allowed into 2027 (from a 2026 plan year) | $680 | Official (Rev. Proc. 2025-32) | $660 (from 2025) |
| Carryover from 2027 into 2028 (20% of the limit) | $700 | Computed; IRS confirms in its annual revenue procedure | n/a |
| Dependent care FSA, household | $7,500 | Fixed by law, not indexed | $7,500 |
| Dependent care FSA, married filing separately | $3,750 | Fixed by law, not indexed | $3,750 |
For the official 2026 numbers and sources, see FSA limits 2026. Related: HSA contribution limits 2027 and 401(k) contribution limits.
Health FSA payroll savings
Deduction per paycheck
$134.62
- Federal income tax saved
- $770.00
- FICA saved (7.65%)
- $267.75
- Estimated tax savings a year
- $1,037.75
- Cost of the election after savings
- $2,462.25
Estimate only. It adds your federal marginal rate to FICA: the 6.2% Social Security tax stops at the wage base ($192,300 in 2027) while the 1.45% Medicare tax applies to all wages. People in the 32% bracket and above are usually over the wage base. The 0.9% additional Medicare tax and state income tax are not included.
Dependent care FSA household cap
A spouse who is a full-time student or not able to care for themselves is treated as having earned income for each month of school or incapacity (26 U.S.C. 129(b)(2) and 21(d)(2)), so the earned-income cap may not apply.
Cap for this filing status: $7,500
$7,500
elected for the household
Within the cap, with $0 of room left.
The cap applies to the household, not to each spouse. On a joint return both spouses' elections count toward one $7,500 cap; each spouse filing separately has $3,750.
Back-test: one rule reproduces every IRS limit from 2014 to 2026
Section 125(i) says that when an increase is not a multiple of $50, "such increase shall be rounded to the next lowest multiple of $50." We start from $2,500, apply the section 1(f)(3) cost-of-living adjustment measured from the 12 months ending August 2012, and round the increase down to $50. For 2014 to 2017 the adjustment uses CPI-U; for 2018 on, the law uses the chained CPI (C-CPI-U), scaled to the 2012 base by the 2016 ratio of C-CPI-U to CPI-U. The carryover is 20 percent of the limit. The table compares our computed limit with the IRS figure for each year.
| Year | Index (Sep to Aug average) | Before rounding | Computed limit | IRS limit | Computed / IRS carryover | Match |
|---|---|---|---|---|---|---|
| 2014 | CPI-U 232.018 (Sep 2012 to Aug 2013) | $2,542.39 | $2,500 | $2,500 | $500 (Notice 2013-71) | Exact |
| 2015 | CPI-U 235.685 (Sep 2013 to Aug 2014) | $2,582.57 | $2,550 | $2,550 | $500 (Notice 2013-71) | Exact |
| 2016 | CPI-U 236.749 (Sep 2014 to Aug 2015) | $2,594.23 | $2,550 | $2,550 | $500 (Notice 2013-71) | Exact |
| 2017 | CPI-U 238.649 (Sep 2015 to Aug 2016) | $2,615.05 | $2,600 | $2,600 | $500 (Notice 2013-71) | Exact |
| 2018 | C-CPI-U 138.237 (Sep 2016 to Aug 2017) | $2,658.20 | $2,650 | $2,650 | $500 (Notice 2013-71) | Exact |
| 2019 | C-CPI-U 140.992 (Sep 2017 to Aug 2018) | $2,711.18 | $2,700 | $2,700 | $500 (Notice 2013-71) | Exact |
| 2020 | C-CPI-U 143.179 (Sep 2018 to Aug 2019) | $2,753.23 | $2,750 | $2,750 | $550 (Notice 2020-33) | Exact |
| 2021 | C-CPI-U 144.814 (Sep 2019 to Aug 2020) | $2,784.67 | $2,750 | $2,750 | $550 / $550 | Exact |
| 2022 | C-CPI-U 149.064 (Sep 2020 to Aug 2021) | $2,866.39 | $2,850 | $2,850 | $570 / $570 | Exact |
| 2023 | C-CPI-U 159.879 (Sep 2021 to Aug 2022) | $3,074.37 | $3,050 | $3,050 | $610 / $610 | Exact |
| 2024 | C-CPI-U 168.317 (Sep 2022 to Aug 2023) | $3,236.62 | $3,200 | $3,200 | $640 / $640 | Exact |
| 2025 | C-CPI-U 173.016 (Sep 2023 to Aug 2024) | $3,326.98 | $3,300 | $3,300 | $660 / $660 | Exact |
| 2026 | C-CPI-U 177.206 (Sep 2024 to Aug 2025) | $3,407.55 | $3,400 | $3,400 | $680 / $680 | Exact |
| 2027 | C-CPI-U 182.629 to 182.856 (Sep 2025 to Aug 2026) | $3,511.84 to $3,516.20 | $3,500 | Not yet announced | $700 / pending | Pending |
CPI-U: all items, U.S. city average, not seasonally adjusted (BLS series CUUR0000SA0). C-CPI-U: same basis, BLS series SUUR0000SA0. The 2027 row shows both treatments of the missing October 2025 month: the lower average fills October with the average of September and November, and the higher one uses the 11 published months. The tightest margin in the back-test is $3.23 above a $50 step in 2020. Each year the IRS used the initial or interim values available when BLS released August data; this table uses today's revised values, which still reproduce every year. For 2018, Rev. Proc. 2017-58 set the limit under the old CPI-U method; the post-TCJA Rev. Proc. 2018-18 did not change it, and the chained-CPI method gives the same $2,650.
Why the missing October 2025 figure does not move the 2027 limit
BLS did not publish October 2025 index values because of the federal funding lapse, so the 12 months ending August 2026 have no October. We computed both ways. With the 11 published months the amount before rounding is $3,516.20; filling October with the average of September and November gives $3,511.84. Both round down to $3,500, so the answer does not depend on that choice.
The $3,500 step covers C-CPI-U averages from 182.01 up to but not including 184.61. Both treatments, at 182.63 and 182.86, sit inside that band with room on both sides (about 0.62 index points on the low side). Later BLS revisions do not matter for 2027: 26 U.S.C. 1(f)(6)(A) uses the values as published on the day BLS releases August data (September 11, 2026), and those are the values used here. The open question is only how the IRS treats the missing October.
The IRS could still choose a different method for the missing month or announce something unexpected, which is why this stays a computed figure until the revenue procedure is out.
Dependent care FSA: already set at $7,500
26 U.S.C. 129(a)(2)(A) now says the excludable amount "shall not exceed $7,500 ($3,750 in the case of a separate return by a married individual)." Public Law 119-21 (section 70404) applies that amount to taxable years beginning after December 31, 2025. It is a fixed dollar figure with no inflation adjustment, so the 2027 limit is the same as 2026. Congress would have to change it. The limit is also capped at your earned income, or your spouse's if lower.
Carryover into 2027 and the 2027 carryover rule
If your plan has a carryover, you can move up to $680 of unused 2026 health FSA money into 2027. That is official (Rev. Proc. 2025-32). Under Notice 2020-33, the maximum is 20 percent of the plan year's limit, so the cap for carrying 2027 money into 2028 is 20 percent of the 2027 limit. A plan can offer a carryover or a grace period of up to 2½ months, not both. The carryover does not reduce the amount you can elect for 2027.
FSA limits 2027 questions
What is the 2027 FSA limit?
The IRS has not announced it yet. It confirms the 2027 health FSA limit in its annual revenue procedure, usually in October or November. Computed from 26 U.S.C. 125(i), the limit should be $3,500, up from $3,400 in 2026. The same formula reproduces every official limit from 2014 to 2026 exactly. The dependent care FSA limit is already fixed by law at $7,500 ($3,750 if married filing separately).
What is the 2027 dependent care FSA limit?
$7,500 per household, or $3,750 if married filing separately. Public Law 119-21 raised the limit from $5,000 starting in 2026 and wrote it into 26 U.S.C. 129 as a fixed dollar amount, so it does not change with inflation and the 2027 figure is the same as 2026.
What will the 2027 health FSA carryover be?
The carryover from the 2026 plan year into 2027 is $680, already official. For a 2027 plan year carried into 2028, IRS Notice 2020-33 sets the maximum at 20 percent of that year's health FSA limit, which would be $700 if the limit is $3,500. The IRS confirms the number in the same revenue procedure.
How do you calculate the 2027 health FSA limit?
Section 125(i) starts from $2,500 and raises it by the cost-of-living adjustment in section 1(f)(3), measured from the 12 months ending August 2012 and using the chained CPI (C-CPI-U) for years from 2018. Any increase that is not a multiple of $50 is rounded down to the next lowest multiple of $50. With the C-CPI-U average for September 2025 to August 2026, the unrounded amount is about $3,516, which rounds down to $3,500.
Did the missing October 2025 inflation figure change the 2027 FSA limit?
We checked both treatments. BLS did not publish a CPI-U or C-CPI-U for October 2025 because of the federal funding lapse. Using only the 11 published months gives about $3,516 before rounding, and filling October with the average of September and November gives about $3,512. Both round down to $3,500, so the missing month does not change the answer.
Can I trust a computed number?
It is an estimate until the IRS confirms it. The formula matches the IRS exactly in all 13 years from 2014 to 2026, but the IRS decides how to treat the missing month and could differ from our reading of the statute. Plan your 2027 election around $3,500 only as a working figure, and check the IRS revenue procedure when it comes out.
When will the IRS announce the 2027 FSA limits?
The health FSA limit is part of the annual inflation-adjustment revenue procedure. The 2026 amounts were in Rev. Proc. 2025-32, and earlier years came out in a similar window, in October or November (the 2026 amounts were released October 9, 2025). Employers need the number before open enrollment closes, so many plans wait for it.
FSA limits by year and related limits
Authoritative sources: 26 U.S.C. 125(i) · 26 U.S.C. 1(f)(3) · 26 U.S.C. 129 · Pub. L. 119-21 · IRS Rev. Proc. 2025-32 · IRS Notice 2020-33 · BLS: CPI-U and C-CPI-U