Families of special needs kids are pissed....
Medical deductibility goes from a threshold of 7.5% AGI to 10% AGI.
Also the tax on medical appliances.
Again special needs families are pissed.
Actually, I don't think either figure is correct as a matter of law - the maximum amount is established by the employer when they set up the plan. My employer has a $5000 limit; it sounds like your employer is changing the limit. [If I am incorrect, feel free to post a citation to the correct information; remember that I am addressing the Flexible Spending Accounts for healthcare, not the Medical Savings Accounts, which are different.]
This is from the Bureau of Labor Statistics:
http://www.bls.gov/opub/cwc/cm20031022ar01p1.htm
"Health care flexible spending accounts are employer-established benefit plans that reimburse employees for specified medical expenses as they are incurred. These accounts are allowed under section 125 of the Internal Revenue Code and are also referred to as "cafeteria plans" or "125 plans." The employee contributes funds to the account through a salary reduction agreement and is able to withdraw the funds set aside to pay for medical bills. The salary reduction agreement means that any funds set aside in a flexible spending account escape both income tax and Social Security tax. Employers may contribute to these accounts as well.
There is no statutory limit on the amount of money that can be contributed to health care flexible spending accounts. However, some companies place a limit of $2,000 to $3,000 on flexible spending accounts."