How is a Limited Purpose Health Care FSA funded?

You fund your Limited Purpose Health Care FSA through payroll deductions. During the Benefits Open Enrollment period, you designate how much you would like to contribute to your account for the coming calendar year (referred to as designating your annual goal). The maximum amount you can contribute is determined by the IRS. For plan year 2021, the annual maximum amount is $2,750. The state then deducts your contribution amount from your paychecks throughout the plan year, but your entire annual goal is available to you beginning January 1, 2021.