IRS releases 2025 contribution limits for HSAs

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The Internal Revenue Service has released inflation-adjusted 2025 contribution limits for health savings accounts, or HSAs, and the maximum amount that may be made newly available for excepted benefit health reimbursement arrangements, or HRAs.

The IRS states in Revenue Procedure 2024-25 that the annual contribution limit for an individual with self-only coverage under a high deductible health plan is $4,300, up from $4,150 in 2024.1

For calendar year 2025, the annual limitation on deductions for an individual with family coverage under a high deductible health plan is $8,550, up from $8,300 in 2024.

Employees contribute to HSAs with pretax money. The IRS contribution limit applies to both the employee’s contribution and any money added by the employer. Workers 55 and older can contribute an additional $1,000 annually to an HSA.

“HSA contribution limits and HDHP deductibles are indexed to CPI, so as long as we experience hotter-than-usual inflation, we will see larger increases than we did pre-pandemic,” Jake Spiegel, research associate at the Employee Benefit Research Institute, told ThinkAdvisor Thursday in an email.

A “high deductible health plan” is defined as a health plan with an annual deductible that is not less than $1,650 for self-only coverage or $3,300 for family coverage, and for which “the annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not premiums) do not exceed $8,300 for self-only coverage or $16,600 for family coverage,” the IRS states.

Excepted benefit HRAs allow employers to pay for additional medical care, like vision or dental coverage, coinsurance and co-payments, that their primary group plan does not cover. “They essentially act as a purse of money that employees can use to pay for medical expenses,” EBRI explained.

Employers can contribute up to $2,150 to a worker’s excepted benefit HRA in 2025, up from $2,100 in 2024.

 

This article was written by Melanie Waddell from ThinkAdvisor and was legally licensed through the DiveMarketplace by Industry Dive. Please direct all licensing questions to legal@industrydive.com.

 

1. "Revenue Procedure 2024-25." IRS, 2024.

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