Dependent care FSAs are employer-sponsored benefit accounts that allow employees to set aside pre-tax dollars to pay for eligible dependent care expenses, such as childcare, eldercare, or disability care. The annual limit on the amount that can be contributed to a dependent care FSA is set by the IRS and is adjusted each year.
The dependent care FSA limit for 2025 is $5,000 for married couples filing jointly and $2,500 for all other filers. This limit is the same as the limit for 2024.
457b 2025 limits refer to the annual limit on the amount of money that can be contributed to a 457(b) plan, a tax-advantaged retirement savings plan for employees of state and local governments and certain tax-exempt organizations. For 2023, the 457(b) contribution limit is $22,500, and the catch-up contribution limit for participants who are age 50 or older is $7,500.
457(b) plans offer several benefits, including tax-deferred growth of investments, a choice of investment options, and the ability to make catch-up contributions. Additionally, 457(b) plans are not subject to the same contribution limits as 401(k) plans, making them an attractive option for high-income earners.
Beginning in 2025, there will be new limits on the amount of compensation that can be deferred under nonqualified deferred compensation (“NQDC”) plans. These limits are designed to prevent the use of NQDC plans as a way to avoid taxes on compensation. Employers may want to make changes to their NQDC plans before the end of 2024 to avoid these new limits.
Under current law, there is no limit on the amount of compensation that can be deferred under an NQDC plan. However, the Tax Cuts and Jobs Act of 2017 included a provision that will impose new limits on NQDC plans beginning in 2025. These limits will be based on the employee’s W-2 wages, and they will vary depending on the type of plan. Under a “specified” NQDC Plan, the limit on deferrals for 2025 will be the lesser of $30,000 (plus applicable cost-of-living adjustments) or 15% of the employee’s W-2 wages.
The term “2025 flexible spending account limits” refers to the maximum amount of money that individuals can contribute to their flexible spending accounts (FSAs) in 2025. FSAs are tax-advantaged accounts that allow employees to set aside pre-tax dollars to pay for qualified medical expenses. The limit for 2025 is set by the Internal Revenue Service (IRS) and is adjusted annually.
Importance of 2025 Flexible Spending Account Limits:
In May 2023, the US Department of Transportation (DOT) established new limits on the size and weight of commercial motor vehicles operating on the nation’s highways, effective in 2025. The new limits, known as the “2025 415c limits,” are designed to improve safety and efficiency on the nation’s roadways. The new limits will increase the maximum allowable length of commercial motor vehicles from 48 to 53 feet and the maximum allowable weight from 80,000 to 91,000 pounds.
The 2025 415c limits are expected to have a number of benefits, including:
