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HSA 2021 contribution limit and HDHP out-of-pocket to increase — IRS
The Internal Revenue Service announces inflation-adjusted figures for the HSA 2021 contribution limit. Amounts increase for self-only and family coverage contributions as well as the maximum out-of-pocket limit for the high-deductible health plan that is required for HSA eligibility.
HSA 2021 contribution limit
Rev. Proc. 2020-32 from the IRS announces inflation-adjusted amounts for Health Savings Accounts in the 2020 calendar year, in accordance with § 223 of the Code.
More HSA tax savings
Persons with self-only HDHP coverage may deposit up to $3,600 in calendar year 2021; those with family coverage may deposit up to $7,200.
The HSA 2021 contribution limit applies aggregately to deposits by the account owner, employer, and any others.
HDHP minimum deductible unchanged
An HSA-eligible HDHP must have an annual deductible of at least at least $1,400 for self-only plans and at least $2,800 for family coverage in 2021.
HDHP Out-of-pocket maximum higher
Out-of-pocket expenses are the combined total of the HDHP deductible, co-payments, and other amounts (but not premiums) paid directly by the HSA account owner.
In 2021, these may not exceed $7,000 for self-only coverage or $14,000 for a family plan.
Catch-up provision
The catch-up allowance for persons age 55 and older is not adjusted annually. It remains at $1,000 for calendar year 2020.
Plan document updates
Generally, a company’s Section 125 Cafeteria plan document does not need to be updated for the HSA 2021 contribution limit increase because the plan document is written to reflect whatever the IRS limit is for the year, or for a set dollar amount lower than the IRS limit.
Employers wanting to update a plan document to change a stated dollar amount, or to restate the Section 125 plan for any other reason, can do so quickly and conveniently with our secure online order form.
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Summary
The following tables summarize HSA amounts for 2021, with the previous four years for comparison:
| HSA Annual Contribution Limits |
|
2021 |
2020 |
2019 |
2018 |
2017 |
| Self-only coverage |
$3,600 |
$3,550 |
$3,500 |
$3,450 |
$3,400 |
| Family coverage |
$7,200 |
$7,100 |
$7,000 |
$6,900 |
$6,750 |
| Age 50+ catch-up (add’l) |
1,000 |
$1,000 |
$1,000 |
$1,000 |
$1,000 |
| HDHP Minimum Deductible |
|
2021 |
2020 |
2019 |
2018 |
2017 |
| Self-only coverage |
$1,400 |
$1,400 |
$1,350 |
$1,350 |
$1,300 |
| Family coverage |
$2,800 |
$2,800 |
$2,700 |
$2,700 |
$2,600 |
| HDHP Out-of-Pocket Maximum |
|
2021 |
2020 |
2019 |
2018 |
2017 |
| Self-only coverage |
$7,000 |
$6,900 |
$6,750 |
$6,650 |
$6,550 |
| Family coverage |
$14,000 |
$13,800 |
$13,500 |
$13,300 |
$13,100 |
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