With a low inflation rate, the 2016 flexible spending maximum contribution for employees is expected to remain unchanged. According to industry experts, the maximum contribution will remain at $2,550 barring a surge in inflation during the fourth quarter of this year.
401k/403b/457 Elective Deferral Limit
For tax year 2016, the contribution limit for 401K/403b/457 plans will stay at $18,000. The catch-up contribution limit for employees over age 50 will also stay at the current contribution limit of $6,000.
Section 132 Qualified Transportation Benefits
A change has occurred to the way commuter benefits plans are managed. Beginning January 1, 2016, employees who use a qualified transportation method to commute to work will need to use a section 132 credit card to pay for your commuting costs. The credit cards will be provided by the company sponsored plan. Submitting electronic or paper claims for transportation will no longer be a valid form for reimbursement. Electronic and paper claims will be continue to be accepted for parking related expenses.
As of the posting of this message, the maximum contribution for pre-tax transportation benefits will remain at $130 per month for 2016. The pretax parking contribution limit has been raised to $255 per month starting in January 2016.