--- title: IRS Announces 2025 COLAs for Transportation Fringes, FSA Deferrals description: IRS announces 2025 COLAs for transportation fringes and FSA deferrals. image: https://www.payroll.org/images/default-source/default-album/cola19.jpg?sfvrsn=6d0f5a9e_0 --- [![soc-fb](https://blogs.payroll.org/hubfs/ct-23-assets/footer-icon_fb.svg "soc-fb")](https://www.facebook.com/American-Payroll-Associations-Chapter-Relations-877434285724525/) [![soc-in](https://blogs.payroll.org/hubfs/ct-23-assets/footer-icon_li.svg "soc-in")](http://www.linkedin.com/groups?about=&gid=1051077&trk=anet_ug_grppro) [![soc-tw](https://blogs.payroll.org/hubfs/ct-23-assets/footer-icon_tw.svg "soc-tw")](https://twitter.com/APAChapters?lang=en) - [Home](https://blogs.payroll.org/chapter-leaders) - [About](https://blogs.payroll.org/about) - [Connect](https://blogs.payroll.org/connect) - [Resources](https://blogs.payroll.org/resources) ![23-PayNewsNow-Horiz-Logo](https://blogs.payroll.org/hs-fs/hubfs/23-PayNewsNow-Horiz-Logo.png?width=1300&name=23-PayNewsNow-Horiz-Logo.png "23-PayNewsNow-Horiz-Logo") [![26 PayrollOrg®RGB-NoTag long](https://blogs.payroll.org/hs-fs/hubfs/26%20PayrollOrg%C2%AERGB-NoTag%20long.jpg?width=1300&name=26%20PayrollOrg%C2%AERGB-NoTag%20long.jpg "26 PayrollOrg®RGB-NoTag long")](https://payroll.org/) Custom URL No Widget: By [Rayna Alexander, Esq.](https://blogs.payroll.org/pay-news-now/author/rayna-alexander-esq) on Oct 22, 2024 12:46:43 PM # IRS Announces 2025 COLAs for Transportation Fringes, FSA Deferrals The IRS released cost-of-living-adjustments (COLAs) for 2025 reflecting any increases in excludable transportation fringes and the flexible spending arrangement (FSA) deferral limit, among other changes \[[**Rev. Proc. 2024-40**](https://www.irs.gov/pub/irs-drop/rp-24-40.pdf), 10-22-24\]. **2025 COLAs for Transportation Fringes, FSA Deferrals** For 2025, the amounts that may be excluded from gross income for employer-provided qualified transportation fringe benefits and qualified parking increase to $325 per month ($315 in 2024). For plan years beginning in 2025, the dollar limitation for voluntary employee salary reductions for contributions to health FSAs increases to $3,300 ($3,200 in 2024). For cafeteria plans that permit the carryover of unused amounts, the maximum carryover amount increases to $660 ($640 in 2024). Complete coverage of the announced changes will be in *Payroll Currently* ([**Issue 11**](https://bookshelf.payroll.org/pc2411), Vol. 32, 11-1-24). **For More Information** For more information, see the PAYO Compliance Update, [**IRS Announces 2025 COLAs for Transportation Fringes, FSA Deferrals, and More**](https://payroll.org/compliance/compliance-overview/compliance-updates/irs-announces-2025-colas-for-transportation-fringes-fsa-deferrals-and-more). Compliance updates are emailed to PayrollOrg members and are also available on the [**Compliance Updates**](https://payroll.org/compliance/compliance-overview/compliance-updates) webpage. --- *Rayna Alexander, Esq., is Editor of Payroll Information Resources for PayrollOrg.* ### Search ![payroll-logo-white](https://blogs.payroll.org/hs-fs/hubfs/payroll-logo-white.png?width=200&name=payroll-logo-white.png "payroll-logo-white") [Privacy Policy](http://www.americanpayroll.org/privacy/)     |     Acceptable Use ©[PayrollOrg](http://payroll.org) [![soc-fb](https://blogs.payroll.org/hubfs/ct-23-assets/footer-icon_fb.svg "soc-fb")](https://www.facebook.com/PayrollOrg) [![soc-in](https://blogs.payroll.org/hubfs/ct-23-assets/footer-icon_li.svg "soc-in")](https://www.linkedin.com/company/payroll-org/mycompany/) [![Twitter-X-White-Logo-PNG](https://blogs.payroll.org/hs-fs/hubfs/Twitter-X-White-Logo-PNG.png?width=20&height=19&name=Twitter-X-White-Logo-PNG.png)](https://twitter.com/PayNews)