On April 29, 2016, the Internal Revenue Service (IRS) released Revenue Procedure 2016-28 to announce the inflation-adjusted limits for health savings accounts (HSAs) for calendar year 2017. The IRS announced the following limits for 2017:
- The maximum HSA contribution limit;
- The maximum deductible amount for high deductible health plans (HDHPs); and
- The maximum out-of-pocket expense limit for HDHPs.
These limits vary based on whether an individual has self-only or family coverage under and HDHP. Only one of the HSA limits will increase for 2017: the HSA contribution limit for individuals with self-only HDHP coverage will increase by $50 for 2017.
|Type of Limit||2017||2016||Change|
|HSA Contribution Limit||Self-only||$3,400||$3,350||$50 increase|
|HSA Catch-up Contributions (not subject to adjustment for inflation)||Age 55 or older||$1,000||$1,000||No change|
|HDHP Minimum Deductible||Self-only||$1,300||$1,300||No change|
|HDHP Maximum Out-of-pocket Expense Limit (deductibles, copayments and other amounts, but not premiums)||Self-only||$6,550||$6,550||No change|
H.S.A.s are special medical reimbursement accounts (under § 223) that generally can be funded only for individuals who are enrolled in “high deductible health plans” (HDHPs) as defined under IRC § 223(c)(2)(A), and who are not enrolled in non-HDHP health plans. (There are limited exceptions; H.S.A. contributions can be made by or on behalf of individuals who are also enrolled in “limited purpose” health flexible spending accounts, in “permitted insurance” under IRC § 223(c)(3), in “disregarded coverage” under IRC § 223(c)(1)(B)(ii) or in “preventive care” under § 223(c)(2)(C).)
The annual limit on H.S.A. deductions is at Code section 223(b)(2)(A)
High deductible health plan definition, annual deductible minimum and out-of-pocket maximum are in Code section 223(c)(2)(A). The out-of-pocket maximum includes in-network deductibles, copayments and coinsurance, but does not include premiums or balance-billing for out-of-network services.