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10.27.20

Health savings accounts limits for 2021

BY Christopher F. Caldwell, EA

A Health Savings Account (HSA) is a way to pay for your current health care needs and to allow for future value growth in your account to plan for anticipated health costs during retirement years.

The IRS has recently announced that HSA contributions limits will increase in 2021. Under a high deductible health plan, an individual with self-only coverage can contribute up to $3,600 and an individual with family coverage can contribute up to $7,200 in 2021.

In 2021, there is no change in HSA catch-up contributions of $1,000 for those age 55 or older from 2020.

For 2021, a high deductible health plan (HDHP) is a health plan with an annual deductible that is not less than $1,400 for self-only coverage or $2,800 for family coverage, and the annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not premiums) do not exceed $7,000 for self-only coverage or $14,000 for family coverage.

Tags: Income Tax

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Author

Christopher F. Caldwell, EA

Professional Specialist

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