The IRS has announced the inflation adjusted HSA limits for 2016. So you can now plan your HSA and health insurance strategy for 2015 and 2016.
A health savings account (HSA) is a savings account which individuals can be fund with pre-tax dollars and later use the money to pay for medical expenses. This allows the individual to get more bang for the buck since they are paying medical expenses with pre-tax, rather than after-tax, dollars.
In order to have an HSA, an individual must participate in a high deductible health plan.
The announced limits dictate the annual allowable contribution to an HSA as well as the minimum deductible and maximum out-of-pocket expense amounts for high-deductible health plans.
High Deductible Health Plan
A high deductible health plan for 2015 and 2016 must have an annual deductible of at least $1,300 for self-only coverage and $2,600 for family coverage. Additionally the health plan cannot have out-of-pocket maximum amounts greater then $6,450 for self-only coverage and $12,900 for family coverage in 2015 and $6,550 for self-only coverage and $13,000 for family coverage in 2016 .
HSA Contribution Limits
There are also limits to how much an individual can save in their HSA account each year. In 2015 and 2016 HSA contribution limits are $3,350 for an individual and $6,650, in 2015, and $6,750 , in 2016, for a family. Individuals who are 55 or older are allowed to contribute an additional $1,000 per year.
For more information on HSA’s check out this IRS Publication: IRS Publication 959