Answer
How much should I consider putting into an HSA or healthcare FSA?
The short answer
The legal limit is the most you are allowed to put in, not a target. For a healthcare FSA, start with costs you are fairly sure of, because unused money may be lost. For an HSA, choose an amount you can afford and stay under the limit, counting employer money.
Key takeaways
- Check your employer's plan limit and rules. They can be lower than the federal limit.
- For an FSA, a careful estimate protects you from losing money at year end.
- For an HSA, your contributions plus your employer's must stay within the yearly limit.
Words in this lesson
- HSA (health savings account)
- A savings account you own for medical costs, available with an HSA-qualified high-deductible plan. Money rolls over each year.
- Healthcare FSA (flexible spending account)
- A work account where you set aside pay before federal tax for medical costs. Unused money is generally lost unless your plan offers a carryover or grace period.
- Carryover and grace period
- Optional healthcare FSA features. A carryover lets some unused money move to next year. A grace period gives extra time to spend it. A plan may offer one, not both, or neither.
- Catch-up contribution
- An extra amount people 55 or older can put into an HSA each year. It is $1,000.
- Qualified medical expense
- A cost that tax rules allow HSA, FSA, or HRA money to pay, such as many doctor visits, prescriptions, and dental care.
Related
This is general education. For decisions about your own plan, taxes, or legal rights, check your plan documents or a qualified professional.
Sources
- Publication 969 (2025), Health Savings Accounts and Other Tax-Favored Health Plans
- Rev. Proc. 2025-19 (2026 HSA, HDHP and excepted-benefit HRA amounts)
- Rev. Proc. 2026-24 (2027 HSA, HDHP, excepted-benefit HRA and DPCSA amounts)
- Message Board: 2026 FSA contribution limits
- Publication 502 (2025), Medical and Dental Expenses