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IRS Issues 2016 HSA Contribution Limits

A comparison of the 2016 and 2015 limits is shown below:

Contribution and Out-of-Pocket Limits for Health Savings Accounts
and High-Deductible Health Plans

 

For 2016

For 2015

Change

HSA contribution limit(employer + employee)

Individual: $3,350

Family: $6,750

Individual: $3,350

Family: $6,650

Individual: no change

Family: +$100

HSA catch-up contributions(age 55 or older)*

$1,000

$1,000

No change**

HDHP minimum deductibles

Individual: $1,300

Family: $2,600

Individual: $1,300

Family: $2,600

Individual: no change

Family: no change

HDHP maximum out-of-pocket amounts(deductibles, co-payments and other amounts, but not premiums)

Individual: $6,550

Family: $13,100

Individual: $6,450

Family: $12,900

Individual: +$100

Family: +$200

* Catch-up contributions can be made any time during the year in which the HSA participant turns 55.

** Unlike other limits, the HSA catch-up contribution amount is not indexed; any increase would require statutory change.


Penalties for Nonqualified Expenses

Those under age 65 (unless totally and permanently disabled) who use HSA funds for nonqualified medical expenses face a penalty of 20 percent of the funds used for such expenses. Funds spent for nonqualified purposes are also subject to income tax.