2026 IRS contribution limits
| Amount |
Max Employee Contribution | $3,400/yr |
Max Employer Contribution | Up to $500 → $1:$1 |
Max Carryover | $680 |
Source: IRS Revenue Procedure 2025-32
Employee contributions
Your contribution is deducted from your paycheck based on the total annual amount you elect.
Confirm your plan's contribution limit
Your contribution limit can vary by plan. Check with your administrator to confirm the limit amount and frequency that applies to your organization.
Employer contributions
Employers can make up to $500 in non-elective contributions to a health FSA to help preserve the plan's excepted benefit status. If an employer's contribution matches employee contributions dollar-for-dollar, employers can contribute more than $500. Employer contributions don't count toward your maximum contribution limit.
What happens to unused funds
By default, unused FSA funds don't roll over, they're forfeited at the end of the plan year. However, your employer may offer one exception to this: a carryover or an extension, not both.
Carryover: your employer can allow you to keep up to $680 of unused funds and use them the following plan year.
Extension (grace period): instead of carryover, your employer can give you up to an extra 2.5 months after the plan year ends to spend down any remaining balance.
A note on terminology
You may see "rollover" used interchangeably with "carryover." They refer to the same thing.
Qualified reservist distribution
If you're called to active military duty for more than 179 days, or for an indefinite period, you may be able to withdraw your unused FSA funds through a special reservist distribution. This amount is reported as wages and is subject to employment taxes.