How Much is the Annual HSA Contribution?

One common question many individuals have about Health Savings Accounts (HSAs) is how much can be contributed annually. The IRS sets limits on annual HSA contributions, which are subject to change each year. For 2021, the maximum annual contribution for an individual with self-only coverage is $3,600, and for those with family coverage, the limit is $7,200.

It's important to note that these contribution limits include both employee and employer contributions combined. If you are 55 or older, you are allowed to make an additional catch-up contribution of $1,000 per year.

Contributions to an HSA are tax-deductible, meaning you can reduce your taxable income by the amount you contribute to the account. This can lead to significant tax savings, making HSAs a valuable tool for managing healthcare costs.

The annual contribution limits for Health Savings Accounts (HSAs) are crucial to understand for effective financial planning. For the year 2023, the maximum contribution for individuals with self-only coverage is $3,850 and for family coverage, it is $7,750. The IRS typically adjusts these limits annually, so it's wise to stay informed.