How Much Can You Deposit Each Year in an HSA?

Health Savings Accounts (HSAs) are a great way to save for medical expenses while enjoying tax benefits. One common question people have is how much they can contribute to their HSA each year. The amount you can deposit into an HSA is determined by the IRS and may vary depending on your individual circumstances.

For 2021, the annual contribution limits for HSAs are:

• Individual coverage: $3,600
• Family coverage: $7,200

It's important to note that these limits are subject to change each year, so it's essential to stay updated on the current IRS guidelines. Additionally, individuals who are 55 or older are allowed to make catch-up contributions of up to $1,000 per year.

Contributions to an HSA are tax-deductible, and the funds in the account can be used for qualified medical expenses tax-free. Any unused funds in the HSA roll over from year to year, making it a valuable long-term savings tool for healthcare costs.

Health Savings Accounts (HSAs) provide an excellent tax-efficient way to save for future medical expenses. Did you know the yearly contribution limits for HSAs can vary? For 2021, individuals can contribute up to $3,600, while families can set aside as much as $7,200 each year. Remember, these limits change annually, so keep an eye on the IRS updates!