The limit
The 2027 FSA limit has not been published yet
As of October 30, 2026, the IRS has not released the 2027 health FSA limit or the 2027 carryover maximum. Those figures normally arrive in the IRS's annual inflation adjustment revenue procedure in the fall, and the IRS's own list of inflation-adjusted items still ends at 2026 (IRS: inflation-adjusted tax items by tax year).
The latest official figures are for plan years beginning in 2026 (IRS Rev. Proc. 2025-32, section 4.15):
| Health FSA item | 2026 (official) | 2027 |
|---|---|---|
| Employee salary-reduction limit | $3,400 | Not yet published |
| Maximum carryover, if your plan allows one | $680 | Not yet published |
Some benefits firms publish projections for 2027. Those are estimates, not IRS figures, so we do not use them here. Two practical points while you wait:
- 1Your employer's enrollment portal shows the cap that applies to you. Employers can set a lower limit than the IRS maximum. If the IRS publishes the 2027 figure after your window closes, your plan decides whether and how to adopt it, so ask your benefits team if the maximum matters to you.
- 2For most people the limit is not the deciding number anyway. The deciding number is how much you will actually spend.
We will update this page when the IRS publishes 2027 figures.
How it works
What an FSA does, in two sentences
A health FSA lets you set aside part of each paycheck before tax and use it for eligible medical costs during the plan year. The catch is that it is mostly use-it-or-lose-it: money you do not spend by the deadline is generally forfeited, unless your plan offers a carryover or a grace period (IRS Publication 969).
Two rules shape how much you should elect:
- 1Your full election is available from day one. The plan must let you be reimbursed up to your full annual amount at any time during the coverage period, regardless of how much you have actually contributed so far (IRS Publication 969). A large bill in February is covered even though you have only paid in a few weeks of deductions.
- 2You generally cannot change the amount mid-year. Publication 969 says you can change or revoke your election only if there is a change in your employment or family status that your plan specifies. Pick the number carefully now.
The estimate
How to estimate your 2027 FSA amount
Start with costs you are confident about, then decide how much uncertainty to add.
Step 1: List the predictable costs
Go through last year's spending and next year's plans. Common predictable items:
- 1Prescriptions you refill every month. Multiply your copay or cost per fill by the number of fills.
- 2Glasses or contacts you buy on a regular cycle.
- 3Planned dental work that your dental plan will not fully cover, including the part above any annual maximum.
- 4Regular visits, such as therapy or physical therapy copays, multiplied by a realistic number of sessions.
- 5Your medical deductible, if you reliably reach it every year.
- 6Over-the-counter medicines and menstrual care products, which are eligible (IRS Publication 502).
Add these up. This is your "confident" number.
Step 2: Decide how much of the uncertain part to include
Unplanned costs are real, but they are also exactly the money that tends to get forfeited. A cautious approach is to elect your confident number, plus no more than the carryover your plan allows, if it allows one. That way, the worst case is that a small amount rolls into next year instead of disappearing.
Step 3: Check your plan's year-end rule
Your plan can have a carryover, a grace period, or neither. It cannot have both (IRS Publication 969).
- 1Carryover: up to the plan's limit (a maximum of $680 for 2026 plan years) moves into the next plan year. A carryover does not reduce the next year's election limit.
- 2Grace period: up to two and a half extra months after the plan year ends to incur new expenses.
- 3Neither: anything not spent by the end of the plan year is forfeited after the claims deadline.
Our guide on FSA deadlines and unused money explains the difference between these and the separate claims run-out period.
A worked example
A worked example
These numbers are illustrative. They show the method, not what care costs.
Say you expect 12 prescription refills at $25 each ($300), new glasses ($250), a dental crown where your share is $600, and you hit your $1,500 deductible every year. Your confident total is $2,650.
You might also have a few unplanned urgent care visits, but you cannot count on them. If your plan offers a carryover, adding a cushion no larger than the carryover limit keeps the downside small.
On the tax side, money elected through an FSA comes out of your pay before federal income tax and, generally, before Social Security and Medicare taxes, because the FSA runs through a cafeteria plan (IRS Publication 15-B). If you are in the 22% federal bracket, each $100 you elect and spend on eligible costs reduces your federal income tax by about $22, plus the payroll tax portion. Each $100 you elect and forfeit is $100 gone. That asymmetry is why the confident number matters more than the limit.
Check this first
Choosing an HSA? Check before you elect an FSA
If you are enrolling in an HSA-eligible plan for 2027, a general-purpose health FSA generally makes you ineligible to contribute to an HSA. That also applies if you are covered by a spouse's general-purpose FSA. Some employers offer a limited-purpose FSA, usually for dental and vision costs, which can be used alongside an HSA (IRS Publication 969).
A grace period on this year's general-purpose FSA can also affect HSA eligibility in the first months of the new year, unless the FSA balance is zero at the end of the plan year. If you are switching from an FSA to an HSA, spend down this year's balance or ask your plan how the grace period works. Our HSA vs FSA calculator compares the two accounts side by side, and how much to put in an HSA for 2027 covers the HSA side.
Other accounts
Dependent care FSAs follow different rules
A dependent care FSA is a separate account for child or dependent care costs, such as daycare or after-school care, so you can work. It is not for medical expenses. Starting in 2026, the maximum exclusion rose from $5,000 to $7,500 a year, or $3,750 for married people filing separately (IRS: Child and dependent care credit information). That amount is set in the tax code and is not indexed for inflation, so it stays $7,500 for 2027 unless Congress changes it. Your employer's plan may set a lower limit.
If things change
If you might leave your job in 2027
Unused health FSA money generally does not leave with you when your job ends, unless continuation coverage such as COBRA applies to the FSA. If you think you may change jobs, a smaller election limits what you could forfeit. On the other hand, because the full election is available from day one, some people who know they have a large expense early in the year use it before they leave. Check your plan's rules on termination dates and claims deadlines, and see losing your coverage for what else changes.
The short version
The short version
- The 2027 health FSA limit and carryover have not been published yet. For 2026 they are $3,400 and $680.
- Elect what you are confident you will spend, not the maximum.
- Add a cushion no bigger than your plan's carryover, if it has one.
- A general-purpose FSA generally blocks HSA contributions. A limited-purpose FSA does not.
- You usually cannot change your election mid-year, so decide now.
Frequently asked questions
Frequently asked questions
What is the FSA limit for 2027?
As of October 30, 2026, the IRS has not published it. The 2026 limit is $3,400, with a maximum carryover of $680 where the plan allows one (Rev. Proc. 2025-32). Your employer's enrollment system will show the cap that applies to your plan.
Should I max out my FSA?
Only if you are confident you will spend the full amount on eligible costs during the plan year, plus any grace period or carryover. The tax benefit applies only to money you spend. Money you forfeit is lost.
Can my spouse and I each have an FSA?
Yes. The salary-reduction limit applies to each employee, so spouses who each have an employer FSA can each elect up to their own plan's limit (IRS Notice 2012-40).
Can I change my FSA amount during the year?
Generally only if you have a change in employment or family status that your plan recognizes, such as marriage, a birth, or a change in employment (IRS Publication 969).
Does my FSA roll over automatically to next year?
Usually not. Many plans require a new election every year, even if your medical plan rolls over. Check your enrollment confirmation to see whether an FSA amount is listed for 2027.
What can I use FSA money for?
Eligible medical expenses such as copays, deductibles, prescriptions, dental and vision care, and many over-the-counter items. IRS Publication 502 lists what counts, and your plan may have its own rules (IRS Publication 502).
