How Much Can You Put into an HSA? - Understanding HSA Contribution Limits

Health Savings Accounts (HSAs) are a valuable tool for managing healthcare expenses while saving on taxes. One common question that many individuals have is how much they can contribute to their HSA each year.

The amount you can put into an HSA is determined by the IRS and is subject to annual limits set by them. These limits can vary depending on your specific situation, such as whether you have self-only or family coverage.

For 2021, the annual contribution limits for HSAs are:

• $3,600 for individuals with self-only coverage
• $7,200 for individuals with family coverage

It's important to note that these limits are for the total contributions made to an HSA, including both your own contributions and any contributions made by your employer. If you are 55 or older, you can also make an additional $1,000 catch-up contribution each year.

Contributions to an HSA are tax-deductible, meaning you can lower your taxable income by the amount you contribute. The funds in an HSA can be used to pay for qualified medical expenses, and any earnings on the account are tax-free as long as they are used for medical expenses.

Health Savings Accounts (HSAs) are not just a way to manage healthcare costs; they are also an incredible vehicle for tax savings. Given that so many people are looking for ways to maximize their savings, it’s essential to understand how much you can contribute to your HSA each year.