IRS Announces 2024 COLAs for Transportation Fringes, FSA Deferrals

The IRS released cost-of-living-adjustments (COLAs) for 2024 reflecting any increases in excludable transportation fringes and the flexible spending arrangement (FSA) deferral limit, among other changes [Rev. Proc. 2023-34, 11-9-23].

2024 COLAs for Transportation Fringes, FSA Deferrals

For 2024, the amounts that may be excluded from gross income for employer-provided qualified transportation fringe benefits and qualified parking increase to $315 per month ($300 in 2023).

For plan years beginning in 2024, the dollar limitation for voluntary employee salary reductions for contributions to health FSAs increases to $3,200 ($3,050 in 2023). For cafeteria plans that permit the carryover of unused amounts, the maximum carryover amount increases to $640 ($610 in 2023).

Complete coverage of the announced changes will be in Payroll Currently (Issue 12, Vol. 31, 12-1-23).

For More Information

For more information, see the PAYO Compliance Update, IRS Announces 2024 COLAs for Transportation Fringes, FSA Deferrals, Foreign Earned Income Inclusion, and More. Compliance updates are emailed to PayrollOrg members and are also available on the Compliance Updates webpage.

To learn more about federal and state laws, regulations, and information to keep your company's payroll operations in compliance, check out Payroll Source Plus!

Jyme Mariani, Esq., is Managing Editor of Payroll Currently and Senior Manager of Payroll Information Resources for PayrollOrg.