FSAFEDS is the flexible spending account program for federal employees, run by OPM. It is the single largest tax break most feds can turn on with one form, and it is also the one benefit that will quietly disappear if you do nothing during Open Season.
Two things make it worth understanding rather than skimming. The dollar limits changed for 2026, including a large statutory jump in the dependent care cap. And the deadlines are unforgiving in a way that FEHB and FEDVIP deadlines are not. Every figure below was checked against FSAFEDS and the IRS on September 6, 2026.
What FSAFEDS Actually Is
An FSA is not insurance. You elect an annual amount, your agency withholds it from pay in equal chunks before taxes, and you draw it back down as you spend on qualifying costs. FSAFEDS estimates the tax saving at roughly 30% of what you run through the account, which is federal income tax plus Social Security and Medicare plus, in most states, state tax.
FSAFEDS offers three accounts:
- Health Care FSA (HCFSA), for medical, dental and vision costs your plan does not cover.
- Limited Expense Health Care FSA (LEX HCFSA), for dental and vision only, and required if you have an HSA.
- Dependent Care FSA (DCFSA), for child and adult care that lets you work.
Eligibility tracks FEHB eligibility, and retirees and annuitants cannot participate at all (a reemployed annuitant can, through the current job). A handful of agencies run their own programs and are outside FSAFEDS entirely: the Federal Judiciary, the DC government, the Farm Credit Administration and Farm Credit System Insurance Corporation, the Federal Reserve System, the Office of the Comptroller of the Currency, the United States Institute of Peace, the Supreme Court, and the Postal Service.
You enroll directly at fsafeds.gov, not through your agency and not through BENEFEDS, though BENEFEDS is what collects the allotment from your payroll provider.
The 2026 FSAFEDS Limits
| 2026 account | Maximum election | Carryover into 2027 | Last day to incur expenses | Claim deadline |
|---|---|---|---|---|
| Health Care FSA | $3,400 | Up to $680 | December 31, 2026 | April 30, 2027 |
| Limited Expense Health Care FSA | $3,400 | Up to $680 | December 31, 2026 | April 30, 2027 |
| Dependent Care FSA | $7,500 ($3,750 married filing separately) | None | March 15, 2027 | April 30, 2027 |
The health care figures are cross-checked. IRS news release IR-2025-103 (October 9, 2025) states that for tax years beginning in 2026 the health FSA salary reduction limit rises to $3,400, up $100, and the maximum carryover to $680, up $20. FSAFEDS publishes exactly the same pair on its own Health Care FSA page, footnoted as the IRS annual contribution limit for 2026.
The minimum health care election is $100. The full annual election is available to you on day one of the plan year, even though you have not funded it yet, which is the one place an FSA beats an HSA outright.
Carryover stacks on top of next year’s election rather than counting against it. Under the FedFlex plan document, reimbursements are limited to your allotment for the plan year plus any amounts carried over, so a maxed 2026 account with $680 left gives you $4,080 to spend in 2027.
For 2027 the health FSA numbers do not exist yet. The IRS publishes them in an omnibus inflation revenue procedure that normally lands in October, and none had been issued as of September 2026. Revenue Procedure 2026-24 covers 2027 HSA and HDHP amounts only. See HSA contribution limits for what is and is not final.
The Limited Expense FSA, and Who Has No Choice
If you carry an HSA-qualified high deductible health plan and actually hold an HSA, a general purpose health care FSA would wipe out your HSA eligibility for the year. FedFlex handles this by rule: a covered employee who holds an HSA, or whose spouse holds one, may enroll only in a Limited Expense Health Care FSA.
The LEX HCFSA has the same $3,400 cap and the same $680 carryover, but it only reimburses dental and vision. Cleanings, X-rays, fillings, crowns, orthodontia, eye exams, glasses, contacts and LASIK are in. Your deductible, your copays and your prescriptions are out, because those are what the HSA is for.
The move most people miss is stacking it against FEDVIP. FEDVIP pays part of a crown, and the LEX account pays your share of the rest with pre-tax dollars. What you cannot do is pay any insurance premium from an FSA, FEDVIP premiums included. FSAFEDS is explicit that IRS rules bar premiums, including long-term care policies and TCC. The general mechanics are the same as any limited purpose FSA, and pairing rules are covered under HSA rollover.
The Dependent Care FSA Jumped to $7,500
This is the biggest 2026 change and it is not an inflation adjustment. The dependent care assistance exclusion had been frozen at $5,000 since 1986. For the 2026 tax year it rose to $7,500, and to $3,750 for married taxpayers filing separately. IRS Publication 15-B for 2026 states the increase directly, and FSAFEDS carries the same figures.
Two constraints bite. The $7,500 is per household, not per person, so two working spouses with separate employer FSAs cannot elect $7,500 each. And your election cannot exceed the earned income limitation: your own salary if single, or the lower of your salary and your spouse’s if married.
Eligible care includes daycare, nursery school, preschool, before and after school programs, summer day camp, babysitters and nannies, and care for a spouse or relative who cannot care for themselves and lives with you. The care has to let you (and your spouse) work, look for work, or attend school full time. Compare the account against the tax credit in dependent care FSA and dependent care FSA limits before you elect, because for some incomes the credit is worth more.
Use It or Lose It, as FSAFEDS Actually Runs It
The three accounts get three different treatments, which is where people lose money.
Health care and LEX accounts get carryover, not a grace period. Expenses must be incurred between January 1 (or your effective date) and December 31. There is no extra time to spend. Whatever is left after the run-out period, up to $680, moves forward. Anything above $680 is gone.
Carryover comes with two conditions. You must be actively employed at a participating agency and contributing through December 31, and you must re-enroll for the next benefit period. Miss either and you forfeit it. You also cannot decline the carryover account: anyone with a balance who re-enrolls gets one automatically.
Dependent care accounts get a grace period, not carryover. FedFlex defines the grace period as the two months and fifteen days after the plan year ends, so 2026 dependent care expenses can be incurred through March 15, 2027. Nothing rolls into 2028. To use the grace period you must have been actively employed and making allotments through December 31.
April 30 is the wall for all three. Under FedFlex, any amount allotted for the plan year is forfeited if a reimbursement claim is not postmarked or electronically transmitted by April 30 following the end of the plan year. That is the run-out deadline, and it applies to carryover balances too.
One ordering trap: current year dollars pay first and carryover pays second. If you are sitting on a prior year expense, submit it before April 30 and before you start filing current year claims, because balances are not reallocated afterward.
What Happens If You Leave Federal Service Mid-Year
Your election terminates automatically when you stop being a covered employee, which FedFlex spells out and separation triggers.
For a health care or LEX account, coverage ends on your separation or retirement date with no extension. Expenses incurred before that date remain claimable until April 30 of the following year. Expenses after it are not reimbursable, even if you accelerated your allotments and the money is sitting there. You cannot cash out the balance. The flip side: if you spent the full election before payroll finished collecting it, you do not owe the remainder back.
For a dependent care account, the remaining balance stays usable for eligible care through the end of the calendar year or until the balance runs dry, whichever comes first. You lose the March 15 grace period, though, because that requires allotments through December 31.
If you return to a FSAFEDS-participating agency within 60 days and inside the same benefit period, your previous election is reinstated at the same amount with recalculated allotments. Come back later than 60 days and you make a fresh election. Either way, expenses incurred while you were not an active employee are never reimbursable. Leave without pay works similarly: the account freezes unless you pre-paid, and health expenses incurred during the freeze are lost.
You Must Re-Enroll Every Open Season
FSAFEDS says it plainly: enrollment is voluntary, you must choose to enroll each year, and participation will not automatically carry over. FedFlex backs it up, treating a failure to return an election form for a plan year as an election to take cash instead.
That is the opposite of every other federal benefit. FEHB, PSHB and FEDVIP all continue automatically if you do nothing. FSAFEDS ends. Thousands of feds discover this in January.
Open Season runs concurrently with the Federal Benefits Open Season, mid-November to mid-December. By OPM regulation the window runs from the Monday of the second full workweek in November through the Monday of the second full workweek in December, which for 2026 points to November 9 through December 14, 2026, for the 2027 benefit period. OPM confirms the exact dates each autumn, so check before you rely on them.
Outside Open Season, new hires have 60 days from the date of hire and must enroll before October 1. A qualifying life event can also open a window, but FSAFEDS will not accept a change that increases your annual election after September 30.
The Bottom Line
Elect $3,400 or less for health care, $7,500 or less for dependent care, spend health care dollars by December 31 and dependent care dollars by March 15, and file everything by April 30. Carry over no more than $680, and only if you re-enroll. If you have an HSA, your only option is the LEX account. And put a reminder in your calendar for the second week of November, because FSAFEDS is the one federal benefit that expires when you ignore it.