A health savings account (HSA) is a tax-advantaged medical savings account a family or individual can use to pay for qualified medical expenses. HSAs are paired with a high-deductible health plan (HDHP) and have annual contribution limits. Each year, the IRS adjusts the annual contribution limit, annual deductible amounts, and other limits for HSAs.
In this post, we’ll cover the new HSA contribution limits and HDHP guidelines that were released by the IRS for 2022 and 2023.
What are the HSA contribution limits for 2022 and 2023?
The IRS released the 2022 HSA guidelines through Revenue Procedure 2021-25 on May 10, 2021.
The following are the 2022 HSA contribution limits:
|
Self-only |
Family |
|
|
HSA contribution limit (company + employee) |
$3,650 |
$7,300 |
|
HSA catch-up contributions (age 55+) |
$1,000 |
$1,000 |
The IRS released the 2023 HSA guidelines through Revenue Procedure 2022-24 and will take effect in January 2023.
The following are the 2023 HSA contribution limits:
|
|
Self-only |
Family plans |
HSA contribution limit (company + employee) |
$3,850 |
$7,750 |
HSA catch-up contributions (age 55+) |
$1,000 |
$1,000 |
Contribution limits are set based on the calendar year, meaning allowable contributions are prorated by the number of months an individual is eligible to contribute to an HSA. If you are age 55+ by the end of the year, you can contribute an additional $1,000 to your HSA. If you are married, and both of you are age 55+, each of you can contribute an additional $1,000.
For example, individuals with single coverage who are HSA-eligible for seven months during the 2022 tax year can only contribute up to $2,129 in 2022 ($3,650 ÷ 12 × 7). The additional catch-up contribution is also prorated, so those aged 55 and over can only contribute an additional $583, using the same example above.
Individuals who are eligible to contribute to an HSA can make contributions at any point during the 2022 tax year, including up through their federal tax return due date (April 15, 2023).
What are the HDHP guidelines for 2022 and 2023?
To be eligible to contribute to an HSA, individuals must have coverage under an HSA-eligible HDHP. The guidelines for HDHP qualification are adjusted each year according to minimum deductibles and maximum out-of-pocket limits, reflecting the highest amount a plan holder would have to pay on their own for out-of-pocket expenses.
The IRS requires health insurance coverage to reflect the following amounts to qualify as an HDHP in 2022:
|
Self-only |
Family |
|
|
HDHP minimum annual deductible |
$1,400 |
$2,800 |
|
HDHP maximum out-of-pocket amount |
$7,050 |
$14,100 |
The IRS requires health insurance coverage to reflect the following amounts to qualify as an HDHP in 2023:
|
|
Self-only |
Family plans |
HDHP minimum annual deductible |
$1,500 |
$3,000 |
HDHP maximum out-of-pocket amount |
$7,500 |
$15,000 |
It’s important to note that not every HDHP is HSA-eligible. Besides meeting the deductible and out-of-pocket requirements, an eligible policy can’t offer any benefit beyond preventive care before meeting the annual deductible.
How do the new limits and guidelines compare with previous years’ limits?
Given the rising rate of inflation across the country, the IRS has consistently increased its limits to help mitigate its effects. However, the increases to the 2023 limits are much higher than in years past.
2022 HSA limits went up $50 for individuals with self-only coverage and by $100 for individuals with family coverage, compared with 2021 limits. When the 2023 guidelines were released, the limits rose another $200 and $450 respectively—much higher than the average increases.
For 2022, the minimum annual deductibles on HDHPs remained the same from 2021’s limits, while maximum out-of-pocket amounts increased by $50 for individuals with self-only coverage and by $100 for those with family coverage.
For 2023, the minimum annual deductible went up $100 for individuals and $200 for families. The highest increase is with the maximum out-of-pocket amounts, where the limits rose $450 for individuals with self-only coverage and $900 for those with family coverage.
Here’s a chart to compare HSA contributions limits for 2021, 2022, and 2023:
|
|
2021 |
2022 |
2023 |
HSA contribution limit (company + employee) |
Self-only: $3,600 Family: $7,200 |
Self-only: $3,650 Family: $7,300 |
Self-only: $3,850 Family: $7,750 |
HSA catch-up contributions (age 55+) |
$1,000 |
$1,000 |
$1,000 |
HDHP minimum annual deductible |
Self-only: $1,400 Family: $2,800 |
Self-only: $1,400 Family: $2,800 |
Self-only: $1,500 Family: $3,000 |
HDHP maximum out-of-pocket amount |
Self-only: $7,000 Family: $14,000 |
Self-only: $7,050 Family: $14,100 |
Self-only: $7,500 Family: $15,00 |
Can I combine an HSA with other health benefits?
HSAs are an increasingly popular tax savings tool, and small employer contributions toward their employees’ HSAs can be a valuable part of employee health plans, helping them save even more on their out-of-pocket expenses.
However, HSAs are even more valuable when combined with a health reimbursement arrangement (HRA). With an HRA, small employers choose an allowance of tax-free money for employees to get reimbursed for qualifying medical expenses.
Learn how you can offer an HSA and an HRA together in our guide
Conclusion
Understanding HSA contribution rules and deductible limits is essential to making the most of the benefit, allowing both you and your employees to maximize contributions and get tax benefits and save on out-of-pocket expenses. An investment in your employees’ health benefits is the best way to show them you care about their health and wellbeing, as well as their financial future, while also helping you recruit and retain top talent.
This article was originally published on May 19, 2021. It was last updated May 16, 2022.
