With healthcare costs continuing to grow, employee benefit programs are becoming a must-have for your employees to pay for eligible expenses with tax-free dollars.
Below is a summary of the 2019 contribution limits for these various employee benefit programs:
Health Flexible Spending Account (Health FSA)
- Employees may contribute up to $2,700 to a Health FSA.
- In addition, employers may contribute up to $500 or a dollar-for-dollar match of the employee’s contribution, whichever is greater.
- Carryover balances (of up to $500) do not count toward the contribution limits.
Dependent Care Flexible Spending Account (DC FSA)
- Employees may contribute up to $5,000 to a DC FSA if they file their taxes as a single or married jointly.
- Employees may contribute up to $2,500 to a DC FSA if they are married but file their taxes separately.
- Employers may contribute to a DC FSA, but employer contributions count toward the limits.
- DC FSA limits do not adjust for inflation.
Commuter Plans
- The monthly contribution limit for mass transportation is $265.
- The monthly contribution limit for qualified parking is $265.
- Employees can participate in both a mass transportation and qualified parking plan.
- Employers may contribute to a Commuter Plan, but employer contributions count toward the limits.
Qualified Small Employer Health Reimbursement Arrangement (QSEHRA)
- The contribution limit is $5,150 for single coverage and $10,450 for family coverage.
- Only employers can contribute to a QSEHRA. Employee contributions are prohibited.
Health Reimbursement Arrangement (HRA) – other than a QSEHRA
- Employers establish the contribution limits.
- Only employers can contribute to the HRA. Employee contributions are prohibited.
- These type of HRAs include those that are integrated with a group health plan, those that only reimburse excepted benefits (e.g. dental/vision), and those that only reimburse former employees (e.g. retirees).
Health Savings Account (HSA)
- Employees may contribute $3,500 if they have single coverage and $7,000 if they have family coverage.
- A catch-up contribution of $1,000 is available for people age 55 or older.
- Employers may contribute to the HSA, but employer contributions count toward the limits.
- Employees must be enrolled in a qualified high deductible health plan (HDHP) and meet other eligibility criteria to participate in an HSA.