2022 Inflation-Adjusted Amounts Released for Health and Welfare Benefits
The IRS has issued Revenue Procedure (Rev. Proc.) 2021-45, which contains cost-of-living adjustments for taxable years beginning in 2022 for over 60 tax provisions, including the following health and welfare benefits.
The dollar limitation under Internal Revenue Code Section (IRC Sec.) 125(i) on voluntary employee salary reductions for contributions to health flexible spending arrangements is $2,850 ($2,750 for 2021). For cafeteria plans that permit the carryover of unused amounts, the maximum carryover amount is $570 ($550 for 2021).
Qualified Transportation Fringe Benefit
The monthly limitation under IRC Sec. 132(f)(2)(A) for the aggregate fringe benefit exclusion amount for transportation in a commuter highway vehicle and any transit pass is $280 ($270 for 2021). The monthly limitation under IRC Sec. 132(f)(2)(B) for the fringe benefit exclusions amount for qualified parking is $280 ($270 for 2021).
Qualified Small Employer Health Reimbursement Arrangement
To qualify as a qualified small employer health reimbursement arrangement under IRC Sec. 9831(d), the arrangement must provide that the total amount of payments and reimbursements for any year cannot exceed $5,450 or $11,050 for family coverage ($5,300 or $10,700 for family coverage for 2021).
For additional information on the 2022 inflation-adjusted limits for other tax provisions, see Rev. Proc. 2021-45.