A flexible spending account (FSA) is money you set aside from your paycheck before taxes to pay for medical costs (a health FSA) or child or adult care while you work (a dependent care FSA). You skip income tax and payroll tax on it, but money you don't spend in time is usually lost. For 2026 the limits are $3,400 for a health FSA and $7,500 per household for a dependent care FSA.
FSA calculator: how much would I save, and what could I lose?
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FSA limits at a glance
Item
2025
2026
2027
Health FSA, most you can put in through payroll
$3,300
$3,400
Not announced yet
Health FSA, most that can carry over (if your plan allows)
$660
$680
Not announced yet
Dependent care FSA, per household
$5,000
$7,500
$7,500 (set by law)
Dependent care FSA, married filing separately
$2,500
$3,750
$3,750 (set by law)
Sources: IRS Rev. Proc. 2025-32 · IRS Pub. 969 · 26 U.S.C. 129 · IRS Pub. 15-B (2026) · IRS Rev. Proc. 2026-24. The health FSA limit is raised for inflation each year (26 U.S.C. 125(i)); the IRS had not published the 2027 amount when we checked on Oct. 23, 2026, and the 2027 HSA notice (Rev. Proc. 2026-24) doesn't include it. The dependent care amount is a fixed dollar figure in the tax code with no inflation adjustment. Your employer's plan can set lower limits.
Health care FSA: the rules
Who can have one: employees whose employer offers it. Self-employed people can't.
Taxes: no federal income tax, Social Security or Medicare tax on what you put in, and reimbursements are tax-free for qualified medical costs.
Limit is per employee: $3,400 for 2026 through salary reduction. If you and your spouse are each eligible, each of you can elect up to the limit, even in the same employer's plan.
All the money is there on day one: your full yearly election must be available at any time in the plan year, even before it's taken from your pay.
You pick the amount at the start of the plan year and can change it only if the law and your plan allow (for example, certain life events).
What it pays for: medical costs that would qualify for the medical expense deduction (IRS Pub. 502), including over-the-counter medicine and menstrual care products, for you, your spouse, your dependents and your children under 27. Not insurance premiums or long-term care.
Leftover money: generally use-it-or-lose-it. A plan may offer either a grace period of up to 2½ months after the plan year or a carryover of up to $680 of 2026 money, never both. Your employer can't give leftover money back to you.
FSA and HSA: a general-purpose health FSA (yours or your spouse's) blocks HSA contributions. A limited-purpose (dental/vision) or post-deductible FSA doesn't.
Reservists called to active duty for more than 179 days may be able to take the balance as a taxable cash distribution, if the plan allows.
Limit: $7,500 per household for 2026 ($3,750 each if married filing separately), up from $5,000 / $2,500. It's a household limit, not per child and not per parent.
Earned income cap: you can't exclude more than your pay or, if married, the lower-earning spouse's pay. A spouse who is a full-time student or can't care for themselves is treated as earning $250 a month ($500 with two or more qualifying people).
Who the care is for: your child under 13, or a spouse or dependent who can't care for themselves and lives with you more than half the year, so that you (and your spouse) can work or look for work.
Taxes: exempt from income tax, Social Security, Medicare and federal unemployment tax up to the limit.
No double dipping: whatever you exclude through the FSA is subtracted from the $3,000 (one person) or $6,000 (two or more) of expenses you can use for the child and dependent care credit, figured on Form 2441 Part III.
Leftover money: the IRS carryover rule (Notice 2013-71) is for health FSAs. Check whether your dependent care plan has a grace period before you elect more than you're sure to spend.
Health FSA of $3,400, 22% bracket, 7.65% payroll tax, no state tax: $3,400 × 29.65% = $1,008.10 of tax you don't pay. If you only spend $3,000 and the plan has a $680 carryover, the $400 left carries over and nothing is lost.
Same $3,400 in a use-it-or-lose-it plan, but you spend $2,000: you still skip $1,008.10 of tax but lose $1,400, so you end up $391.90 worse off than not using the FSA.
Dependent care FSA, married, both working, $9,000 of daycare: the most you can run through the FSA is $7,500 for the household.
How to pick an amount at open enrollment
Add up costs you're sure of for the plan year: deductibles and copays you usually hit, prescriptions, glasses or contacts, dental work, or daycare/after-school bills.
Check your plan's leftover rule (use-it-or-lose-it, carryover or grace period) in the enrollment materials.
Run the calculator and look at the break-even line: how much you could leave unspent and still come out even.
Have an HSA-eligible plan? A general-purpose FSA will block HSA contributions; ask whether a limited-purpose FSA is offered.
Keep receipts. Claims need proof of the expense from a third party.
Show me the details
How the calculator works
Your election is capped at the 2026 limit ($3,400 health; $7,500 or $3,750 dependent care; or the lower earner's pay if you enter it).
Tax skipped = election × (federal bracket + state rate + payroll tax). Payroll tax is 7.65% up to the $184,500 Social Security wage base, 1.45% above it.
Lost = election − expected spending, minus any carryover (health only, up to $680). Net = tax skipped − lost.
Limits of this page
Federal rules. Some states treat FSA contributions differently; enter 0 for state tax if yours doesn't exclude them, or check your state revenue department.
Using the marginal rate is a simplification: a large election can straddle two brackets. The calculator doesn't figure the child and dependent care credit.
Highly paid employees and owners can face extra limits under the plan's nondiscrimination rules.
Not tax advice. Your plan document and HR department have the final word.
Not tax advice. We republish IRS figures with dates and do the arithmetic on what you type. No partner links on this page.
For 2026, you can put up to $3,400 in a health care FSA through payroll, per IRS Rev. Proc. 2025-32. If your plan allows a carryover, up to $680 of unused money can roll into the next plan year. A dependent care FSA allows up to $7,500 per household ($3,750 if married filing separately).
What is the FSA limit for 2027?
The IRS hadn't announced the 2027 health FSA limit as of Oct. 23, 2026; it is adjusted for inflation each year and usually published in the fall. The dependent care FSA limit is set in the tax code at $7,500 and isn't indexed for inflation, so it stays $7,500 for 2027 unless Congress changes it.
Did the dependent care FSA limit go up?
Yes. Starting in 2026, the limit went from $5,000 to $7,500 per household ($2,500 to $3,750 if married filing separately), under Public Law 119-21 (IRS Pub. 15-B, 2026).
What happens to money left in my FSA?
FSAs are generally use-it-or-lose-it. Your plan may give you a grace period of up to 2 1/2 months to spend it, or let you carry over up to $680 of 2026 money, but not both. Your employer can't refund it to you (IRS Pub. 969).
Can I have an FSA and an HSA?
Not a general-purpose health FSA. It makes you ineligible to contribute to an HSA, even if it's your spouse's. A limited-purpose (dental and vision) or post-deductible FSA is allowed (IRS Pub. 969).
Can I use my FSA money before I've paid it all in?
Yes for a health FSA: the full amount you elected must be available at any time during the plan year, even if it hasn't been taken from your pay yet (IRS Pub. 969).
Is this tax advice?
No. VaultRubric republishes IRS figures with dates and does the arithmetic on what you type. Your plan's rules and your HR department have the final word.
Not tax advice. Figures are republished from the IRS with dates; confirm with IRS.gov or a tax professional before acting.