The 2016 limits on contribution and out-of-pocket spending amounts for Health Savings Accounts (HSAs) and for the High-Deductible Health Plans (HDHPs) were increased again this year by the IRS. The IRS provided the inflation-adjusted HSA contribution, HDHP minimum deductible and out-of-pocket limits for 2016. The higher rates reflect the cost-of-living adjustment and rounding rules of Internal Revenue Code section 223.
A comparison of the 2015 and 2016 limits is shown below:
Contribution and Out-of-Pocket Limits for Health Savings Accounts
and for High-Deductible Health Plans
For 2015
1. HSA contribution limit (employer and/or employee)
- Individual: $3,350
- Family: $6,650
2. HSA catch-up contributions (age 55 or older)*
- $1,000
3. HDHP minimum deductible amounts
- Individual: $1,300
- Family: $2,600
4. HDHP maximum out-of-pocket amounts (deductibles, co-payments and other amounts, but not premiums)
- Individual: $6,450
- Family: $12,900
For 2016
1. HSA contribution limit (employer and/or employee)
- Individual: $3,350
- Family: $6,750
2. HSA catch-up contributions (age 55 or older)*
- $1,000
3. HDHP minimum deductible amounts
- Individual: $1,300
- Family: $2,600
4. HDHP maximum out-of-pocket amounts (deductibles, co-payments and other amounts, but not premiums)
- Individual: $6,550
- Family: $13,100
* Catch-up contributions can be made any time during the year in which the HSA participant turns 55.
Effective Jan. 1, 2011, the penalty for using HSA funds for nonqualified medical expenses for those under the age of 65 (unless totally and permanently disabled) increased from 10 percent to 20 percent of the funds used for nonqualified expenses. Funds spent for nonqualified purposes also are subject to income tax.
