2026 FSA Limits and Rules
For the 2026 tax year, the IRS limits individual contributions to a healthcare Flexible Spending Account (FSA) to $3,400. Because FSA contributions are made with pre-tax dollars, funding an FSA reduces your taxable income, saving you money on federal, state, and payroll taxes.
The "Use-It-Or-Lose-It" Rule
Unlike a Health Savings Account (HSA), FSA funds do not roll over indefinitely. Employers can optionally choose one of two exceptions to help employees avoid losing unused funds:
- Carryover: You can roll over up to $680 of unused funds from 2026 into 2027.
- Grace Period: You are given an extra 2.5 months (until mid-March) to incur new medical expenses using the previous year's funds.
To learn more about the differences between these two accounts, read our complete HSA vs FSA Comparison Guide.