FSA Calculator (2026)
A health Flexible Spending Account (FSA) lets you set aside up to $3,400 in 2026 from your paycheck before tax. Because the money is pre-tax, you avoid federal income tax, 7.65% FICA, and state tax on it. At a 22% federal bracket with 5% state, a $3,400 contribution saves about $1,140, so $3,400 of care costs you roughly $2,260. Enter your contribution and rates below.
What is the FSA limit for 2026?
The 2026 health FSA salary-reduction limit is $3,400, up from $3,300 in 2025. Plans with a carryover allow up to $680 to roll into 2027.
How much does an FSA save in taxes?
Contributions are pre-tax, so you save federal income tax, 7.65% FICA, and state tax. At a 22% bracket, $3,400 saves roughly $1,000.
Why does an FSA beat an itemized medical deduction?
FSA contributions also avoid the 7.65% FICA tax, which the itemized medical deduction does not, and there is no 7.5%-of-income floor.
What is the FSA use-it-or-lose-it rule?
Most unused FSA funds are forfeited at year-end, though plans may offer a $680 carryover or a grace period. Estimate your spending carefully.
How does an FSA save you money?
A health FSA is funded through payroll on a pre-tax basis. Every dollar you contribute is excluded from your taxable wages, so it never gets hit by federal income tax, Social Security and Medicare tax (7.65%), or, in most states, state income tax. That makes an FSA one of the few accounts that dodges payroll tax as well as income tax.
- Choose your annual contribution, up to the $3,400 limit for 2026.
- It comes out of your pay in equal pre-tax amounts each period.
- You avoid income tax, 7.65% FICA, and state tax on the whole amount.
- You spend it tax-free on eligible medical, dental and vision costs.
What are the 2026 FSA limits?
The IRS sets the salary-reduction limit each year. The table shows the 2026 figures and how the savings scale with your tax bracket.
| Rule | 2026 amount |
|---|---|
| Health FSA contribution limit | $3,400 |
| Maximum carryover to 2027 | $680 |
| Dependent Care FSA (household) | $7,500 |
| Savings on $3,400 at 22% + FICA + 5% | ~$1,140 |
Is an FSA better than deducting medical expenses?
An FSA is usually better than claiming an itemized medical deduction for two reasons. First, FSA contributions avoid the 7.65% FICA tax, which an itemized deduction never touches. Second, the itemized medical deduction only counts expenses above 7.5% of your adjusted gross income, and only if you itemize — most people do not clear that floor. The FSA gives you the tax break on the first dollar.
What is the use-it-or-lose-it rule?
The catch with an FSA is that unused money is generally forfeited at the end of the plan year. Many plans soften this with a carryover of up to $680 into the next year, or a grace period of up to two and a half months, but not both, and not all plans offer either. The fix is to estimate your predictable costs — copays, prescriptions, dental, vision, eligible over-the-counter items — and fund close to that figure. Compare with the bigger pre-tax picture using our reverse tax calculator.