FSA and HSA contribution limits are changing for 2020. Stick with us as we explain what changed, why it changed, and how you can make the most of these new limits.
In November, the IRS announced that the contribution limit for Flexible Spending Accounts (FSAs) was being raised to $2,750 for 2020. Note that this change also extends to limited-purpose (HSA-compatible) FSAs. Meanwhile, Health Savings Accounts (HSAs) are being raised to $3,550 for individuals and $7,100 for families, up $50 and $100 respectively from 2019.
But while the IRS announced HSA changes in May, the new FSA limits didn’t come for another 6 months, which is during or after open enrollment for most employers. This means that employers may not change their FSA contribution limits until 2021, so be sure to check with your benefits provider to see if the limit changed for you.
Why do Contribution Limits Change?
Contribution limits generally adjust for inflation, then round to the nearest $50. However, healthcare costs in the US are rising at a greater rate. Depending on how many medical expenses you foresee in the new year, even these new limits may not be enough to cover them.
What to Spend Your FSA Funds on
While HSA money rolls over year after year, FSA money usually expires at the end of the year. Sometimes employers offer a grace period or $500 rolled over to the following year. Either way, though, the higher contribution limit means 50 more dollars to spend on medical expenses, but it can also mean 50 more dollars to spend before the year ends.
Luckily, you can use your FSA money on a lot of things, including prescription eyewear. If you have a spouse or kids, you can also use FSA money on them. Check out Last Minute Ideas for Your Flex Spending Dollars to see more of what’s available to you. You might be surprised by what you find!
Prescription Eyewear at SportRx
Need prescription eyewear? Done. When you shop with us, you’ll find video guides and tooltips throughout the build process as you customize the perfect pair. An answer to all your questions is at your fingertips, and if you want to chat with an expert, Contact Us. We’ll put you in touch with one of our friendly in-house opticians who can help you build your prescription eyewear.
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