The Internal Revenue Service (IRS) announced on Tuesday, May 28, new HSA contribution limits, out-of-pocket limits and minimum annual deductibles for next year. Health Savings Account (HSA) owners will see a slight bump across the board for 2020 HSA limits.
2020 HSA Limits Go Up
Next year, HSA owners will be able to make more tax-free contributions to their accounts. The 2020 HSA limits have increased to $3,550 for those with self-only coverage and $7,100 for those with family coverage (See the chart below).
The amount for catch up contributions (for those age 55 and older) stays the same at $1,000 over the annual limit; eligible account owners may contribute up to $4,550 for self-only and $8,100 for family coverage next year.
Minimum Deductibles and Out-of-Pocket Limits
The IRS also increased the minimum annual HDHP deductible and out-of-pocket expense limits for both self-only and family coverage.
2020 HSA Limits, HDHP Minimum Deductible and Out-of-Pocket Maximums
|Annual Contribution Limits||Self-Only: $3,550 (+ $50) |
Family: $7,100 (+ $100)
|Self-Only: $3,500 |
|Catch Up Contributions||Self-Only: $1,000 |
(over annual limit)
(over annual limit)
|Self-Only: $1,000 |
|HDHP Minimum Deductible|| Self-Only: $1,400 (+ $50) |
Family: $2,800 (+ $100)
|Self-only: $1,350 |
|HDHP Out-of-Pocket Maximum*|| Self-only: $6,900 (+ $150)|
Family: $13,800 (+ $300)
|Self-only: $6,750 |
*Out-of-pocket maximums include co-pays, deductibles, and other amounts, but insurance premiums do not apply.
Important HSA Notes
- HSAs are owned by the employee, not the company (like with an FSA), for the life of the account.
- HSA owners make tax-free contributions, earn tax-free interest and investment income, and use the money tax-free for qualified healthcare expenses. View a list of qualified healthcare expenses.
- An HSA may be used for the owner or a dependent.
- After age 65, HSA owners may use their account funds for any expense without penalty; however, if used for a non-qualified expense, the withdrawal is subject to taxes.
- You can only make contributions to an HSA when you’re enrolled in a qualified HDHP; you can use the money in the account even if you do not have HDHP coverage.