2024 transportation and health FSA limits projected 

A crowded subway carriage     
a hand holding hand rail on public transit     
August 15, 2023
Mercer projects the 2024 limits for qualified transportation (parking and transit) benefits and health flexible spending arrangements (FSAs) will increase significantly from 2023 levels. These unofficial 2024 limits are determined using the Internal Revenue Code (IRC)’s cost-of-living adjustment methods, the Chained Consumer Price Index for All Urban Consumers (C-CPI-U) values through July and Mercer’s projected C-CPI-U 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 C-CPI-U for August) — for the coming year in October or November.

Qualified transportation and health FSA limits

Limits for qualified transportation fringe benefits and health FSAs are expected to rise significantly for the second year in a row, due to the unusually large increase in C-CPI-U for the year (5.2% for the 11 months ending July 2023). Before the record 7.1% increase in the 2023 limits, the average annual increase was 2.1% for the period since indexing on transportation fringe benefits began in 1999.
Qualified transportation and health FSA limits Projected 2024 2023
Tax-free qualified transportation fringe benefits (IRC § 132(f))
Qualified parking, transit passes or commuter highway vehicle $315 $300
Health FSA limits (IRC § 125(i))
Salary reduction contribution 3,200 3,050
Carryover to next plan year 640 610

Related resources

Non-Mercer resources

  • C-CPI-U (Bureau of Labor Statistics

Mercer Law & Policy resources

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