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Compliance April 29, 2022
New Limits for HSAs to Account for Inflation Growth
The limit for individuals with self-only coverage will increase by $200, and the limit for those with family coverage will increase by $450.
Reported by DJ Shaw
The IRS has published the 2023 contribution limits for health savings accounts.
With the latest update of the U.S. Consumer Price Index showing a sizeable spike in the inflation rate to 8.5%—the largest 12-month increase since 1981—the new IRS limits represent a larger hike than seen in recent years.
For calendar year 2023, the annual limitation on deductions for an individual with self-only coverage under a high-deductible health plan is $3,850, up $200 from this year’s limit. The annual limitation on deductions for an individual with family coverage under an HDHP is $7,750, an increase of $450 from the 2022 limit.
The limit for individuals was only increased by $50 going into 2022 from 2021, and by $100 for families.
The IRS defines an HDHP for calendar year 2023 as a health plan with an annual deductible that is not less than $1,500 for self-only coverage or $3,000 for family coverage, and for which annual out-of-pocket expenses (deductibles, co-payments and other amounts, but not premiums) do not exceed $7,500 for self-only coverage or $15,000 for family coverage.