2022 transportation, health FSA and Archer MSA limits projected 

August 18, 2021

Mercer projects the 2022 limits for qualified transportation (parking and transit) benefits, health flexible spending arrangements (FSAs) and Archer medical savings accounts (MSAs) will increase. These unofficial 2022 limits are determined using the Internal Revenue Code (IRC)’s cost-of-living adjustment methods, chained Consumer Price Index for All Urban Consumers (chained CPI) values through July and Mercer’s projected chained CPI for August. While adoption assistance program limits generally use the same indexing formula, they can’t be reliably projected due to the small rounding threshold. IRS usually announces these benefit limits — along with long-term care limits (based on the medical component of the chained CPI for August) — for the coming year in October or November.

Qualified transportation, health FSA and Archer MSA limits

Limits for qualified transportation fringe benefits, health FSAs and Archer MSAs are all expected to increase noticeably in 2022, thanks to the unusually large increase in chained CPI for the year (3.1% for the 11 months ending July 2021). The inflationary increases are expected to be as large as several typical years’ worth.

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