Understanding HSA Limits: What Are the Limits for an HSA?

Health Savings Accounts (HSAs) are a valuable tool for individuals looking to save for medical expenses while enjoying tax benefits. As you explore the option of opening an HSA, understanding the limits associated with it is essential to make the most of this financial tool.

So, what are the limits for an HSA?

For 2021, the annual contribution limits for HSAs are as follows:

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

It's important to note that catch-up contributions of $1,000 are allowed for individuals aged 55 and older. These limits are subject to change, so staying informed about any updates from the IRS is crucial.

By staying within the contribution limits, you can maximize the benefits of an HSA and enjoy tax advantages while saving for current and future medical expenses.

Health Savings Accounts (HSAs) are a smart financial choice for those looking to save for healthcare costs. Understanding the contribution limits is key to maximizing these accounts. For the year 2021, the IRS set the contribution limits for HSAs at $3,600 for individual coverage and $7,200 for family coverage. Additionally, if you're 55 or older, you can take advantage of a catch-up contribution of $1,000. Always keep an eye on any updates from the IRS regarding these limits to ensure you’re making the best financial decisions.