A new chapter begins
2026 health FSA, other health and fringe benefit limits now set
October 13, 2025
IRS Rev. Proc. 2025-32 gives the 2026 contribution and benefit limits for health flexible spending arrangements (FSAs), qualified small-employer health reimbursement arrangements (QSEHRAs), long-term care (LTC) policies, transportation fringe benefits and adoption assistance programs. The 2026 figures reflect the increase in the average chained Consumer Price Index for All Urban Consumers (C-CPI-U) for the 12 months ending Aug. 31, 2025, after applying statutory rounding rules.
Health FSA, QSEHRA and LTC limits
This table shows the 2026 adjusted amounts for health FSAs, QSEHRAs and qualified LTC policies, along with the limits for 2025 and 2024. The health FSA carryover limits shown reflect the maximum unused funds that can carry over to the next plan year.
| 2026 | 2025 | 2024 | |
|---|---|---|---|
| Health FSA limits (IRC §125(i)) | |||
| Maximum salary reduction contribution | $3,400 | $3,300 | $3,200 |
| Maximum health FSA carryover | 680 | 660 | 640 |
| QSEHRA limit (IRC § 9831(d)) | |||
| Maximum annual benefit | |||
| Self-only coverage | 6,450 | 6,350 | 6,150 |
| Family coverage | 13,100 | 12,800 | 12,450 |
| Qualified LTC policy limits (IRC § 213(d) and 7702B(d)(4)) | |||
| Premium limits at age | |||
| 40 or younger | 500 | 480 | 470 |
| 41–50 | 930 | 900 | 880 |
| Qualified LTC policy limits (IRC § 213(d) and 7702B(d)(4)) | |||
| Premium limits at age | |||
| 51–60 | $1,860 | $1,800 | $1,760 |
| 61–70 | 4,960 | 4,810 | 4,710 |
| Older than 70 | 6,200 | 6,020 | 5,880 |
| Per diem limit | 430 | 420 | 410 |
The 2026 adjusted amounts for health savings accounts (HSAs), HSA-qualifying high-deductible health plans, excepted-benefit HRAs, out-of-pocket maximums in nongrandfathered group health plans and various indexed amounts for the Affordable Care Act’s employer-shared responsibility provision were announced earlier this year.
Qualified transportation fringe benefits and adoption assistance programs
This table shows the 2026 adjusted figures for qualified transportation fringe and adoption assistance benefits set by Rev. Proc. 2025-32, along with amounts for 2025 and 2024. The 2026 increase in the qualified transportation fringe benefit limit now reflects the one-year shift in the base year for measuring inflation — from 1998 back to 1997 — as enacted by the “One Big Beautiful Bill Act” (Pub. L. No. 119-21; Sec. 70112(b)).
| 2026 | 2025 | 2024 | |
|---|---|---|---|
| Tax-free qualified transportation fringe benefits (IRC § 132 (f)) | |||
| Monthly qualified parking, transit passes or commuter highway vehicles | $340 | $325 | $315 |
| Qualified adoption assistance programs (IRC § 137) | |||
| Exclusion for child with special needs (regardless of expenses incurred) | 17,670 | 17,280 | 16,810 |
| Aggregate dollar limit for all taxable years | 17,670 | 17,280 | 16,810 |
| Phaseout begins at modified AGI of | 265,080 | 259,190 | 252,150 |
| Phaseout completed at modified AGI of | 305,080 | 299,190 | 292,150 |
Related resources
Non-Mercer resources
- Rev. Proc. 2025-32 (IRS, Oct. 9, 2025)
- IRS releases tax inflation adjustments for tax year 2026 (IRS, Oct. 9, 2025)
Mercer Law & Policy resources
- Mercer projects 2026 transportation and health FSA limits (July 24, 2025)
- 2026 affordability percentage for employer health coverage increases (July 22, 2025)
- 2026 HSA, HDHP and excepted-benefit HRA figures set (May 1, 2025; updated June 27, 2025)
- Summary of 2025 benefit-related cost-of-living adjustments (Dec. 10, 2024; updated Jan. 24, 2025)
- 2025 quick benefit facts (Jan. 17, 2025)
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