Families may now contribute $6,850 each year to the HSA.
On March 5, the IRS released a bulletin announcing slightly lower limits for the health savings account (HSA) pre-tax deferrals.
Paired with a qualified high-deductible health plan, an HSA allows you to deduct a set amount of pre-tax money from each paycheck to pay for certain IRS-qualified out-of-pocket health expenses, such as copays, hospital stays, prescription drugs, and more.
The tax reform act, passed December 2017, changed the way annual inflation is calculated for plan adjustments. This new calculation has become effective retroactively to the beginning of January 2018, reducing the amount a family can contribute to the HSA.
Families may now contribute up to $6,850 each year to the HSA, as opposed to the previous $6,900 maximum. The maximum HSA contribution for individuals is unchanged at $3,450.
Nextep is proactively reaching out to each person affected by this change to make adjustments.