NEW YORK (11/12/14)--Next year you can put an extra $50 in your health care flexible spending account bringing the total to $2,550. Meanwhile the contribution limit for dependent care remains fixed at $5,000 where it's been stuck since 1986 when Congress originally set it.
While both accounts are employer-sponsored, the flex account for health care is adjusted each year for inflation. The account to help employees pay for day care is not. If it was, the contribution limit should now be at a robust $10, 859.08 (The New York Times Nov. 7).
For a long time, the government didn't even cap flexible spending accounts for health care--though employers usually limited annual savings to $5,000--but the Affordable Care Act capped it at $2,500 while allowing for future inflation adjustments. Next year will be the first time it's risen since the cap was put in place.
Still, these caps shouldn't stop you from contributing, because the savings can be significant. Here's what you need to know about the various tax-advantaged accounts and their new limits for 2015:
For related information, read "Everybody's Money Matters: Benefits of Health Savings Accounts" in the Home & Family Finance Resource Center.