Tax Tip Tuesday: 2016 Health Savings Account Limits

September 15, 2015

The IRS has provided the annual inflation-adjusted contribution, deductible, and out-of-pocket expense limits for 2016 for health savings accounts (HSAs). Eligible individuals may, subject to statutory limits, make deductible contributions to an HSA.

 

Employers, as well as other persons such as family members, may also contribute on behalf of an eligible individual. Employer contributions generally are treated as employer-provided coverage for medical expenses under an accident or health plan and are excludable from income.

 

In general, a person is an “eligible individual” if he is covered under a high deductible health plan (HDHP) and is not covered under any other health plan that is not a high deductible plan — unless the other coverage is permitted insurance (e.g., for worker's compensation, a specified disease or illness, or providing a fixed payment for hospitalization).

 

For calendar year 2016, the limitation on deductions is

  • $3,350 for an individual with self only coverage  (no change from 2015)

  • $6,750  for an individual with family coverage under a HDHP (up from $6,650 for 2015)

  • Each of these amounts is increased by $1,000 if the eligible individual is age 55 or older

For calendar year 2016, a HDHP is a health plan with an annual deductible that is not less than $1,300 (no change from 2015)

  • $2,600 for self-only coverage or (no change from 2015)

  • Do not exceed $6,550 for family coverage, and with respect to which the annual out-of-pocket expenses, such as deductibles, co-payments, and other amounts, but not premiums (up from $6,450 for 2015)

  • For self-only coverage or $13,100 for family coverage (up from $12,900 for 2015)

Disclaimer: The items included in the Tax Tip Tuesday Video Blog are informational only and are not meant as tax advice. Consult with your tax advisor to determine how any item applies to your situation. IRS Circular 230 disclosure: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. federal tax advise contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.

Please reload

Previous Editions of Tax Tip Tuesday
Please reload

March 5, 2019

February 19, 2019

Please reload

CONTACT US

515-225-3141

news@ryungivens.com

VISIT US

2900 100th Street, Suite 301

Urbandale, IA 50322

© 2014 by Ryun, Givens & Company P.L.C.