How this calculator works
Plan year: 2026, United States. A health flexible spending arrangement accepts up to $3,400 of salary reduction in 2026. If the plan allows a carryover, up to $680 of unused health FSA money can move to the next plan year; otherwise the balance is forfeited under the use-it-or-lose-it rule, unless the plan offers a grace period, which is not modelled. A dependent care FSA accepts up to $5,000 for a household and generally has no carryover, so unused money is forfeited. Elections are made before the plan year, so the model shows the consequence of a chosen election rather than an optimum. The tax saved is the federal income tax on the election; the 7.65% Social Security and Medicare saving is additional and not shown. Unlike a health savings account, an FSA is not portable, does not earn interest and generally stays with the employer, so the comparison with the HSA page is not one to one. The model leaves out the employer contribution to the health FSA, the $2,500 dependent care limit for married filing separately, grace periods, run-out periods, plan-specific carryover terms, the uniform coverage rule, payroll tax and state tax.
Formula
Health FSA limit = $3,400. Dependent care FSA limit = $5,000. Health carryover = min(max(0, election - spent), $680). Health forfeited = max(0, election - spent) - carryover. Dependent care forfeited = max(0, election - spent). Tax saved = (health election + dependent care election) x marginal tax rate.
Worked example
A filer elects $3,400 for health care and $3,000 for dependent care, spends $2,000 and $2,500, and faces a 22% marginal rate. Health care leaves $1,400 unused: $680 is carried over and $720 is forfeited. Dependent care leaves $500 unused and forfeits all of it. The tax saved on $6,400 of salary reduction is $1,408.
Frequently asked questions
What is the 2026 FSA contribution limit?
The health FSA salary reduction limit is $3,400 and the dependent care FSA limit is $5,000. The dependent care limit is set by statute and has not risen with inflation.
How much can I carry over in an FSA?
Up to $680 of unused health FSA money can be carried into the next plan year if the employer plan permits it. Dependent care FSA money generally cannot be carried over.
What happens to unused FSA money?
Under use-it-or-lose-it, any balance above the carryover is forfeited to the employer after the plan year and any grace period. It cannot be refunded to the employee.
How much tax does an FSA save?
Salary reduction avoids federal income tax, Social Security and Medicare tax on the amount elected, so the saving is roughly the marginal rate plus 7.65% payroll tax. This page shows the income tax saving only, before state tax.