Annually, the Internal Revenue Service and Social Security Administration release cost-of-living adjustments that apply to dollar limitations set forth in certain IRS Code Sections. The Consumer Price Index warranted increases in some benefits figures for 2026—for a full summary and charts of key 2026 figures that are of interest to employers and sponsors of benefit plans, please click here.  

Below is a summary of the recently released 2026 limits related to health flexible spending accounts (FSAs) and commuter benefits.  

Health FSAs

The annual contribution limit for health FSAs will increase to $3,400 in 2026. This is a $100 increase from the 2025 contribution limit. An increased FSA carryover for 2026 was also announced—if an employer’s plan permits the carryover of unused health FSA amounts, the maximum carryover amount rises to $680, up from $660.  

Commuter (Parking and Transit)

The commuter benefits limit in 2026 for mass transit and parking will increase to $340 per month. This is an increase from the 2025 monthly limit, which was $325.  

Dependent Care FSAs

As a reminder, the One Big Beautiful Bill Act (OBBB) increases the dependent care FSA pretax contribution limit to $7,500 beginning in 2026. This is a $2,500 increase from the longtime limit of $5,000. As always, please do not hesitate to reach out to our Employee Benefits team with any questions.