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2016 HSA Deduction Limits Set by IRS

Picture of Kayla Kelly Kayla Kelly : May 07, 2015

Latest Industry News employee benefits benefits administration The Latest from Paypro long island payroll companies annual deductible 2016 HSA deduction limits

The Internal Revenue Service has announced, in Revenue Procedure 2015-30, the 2016 inflation-adjusted deduction limits for contributions made to health savings accounts (HSAs). The deduction limits are updated annually to reflect cost-of-living adjustments

Effective for calendar year 2016, the annual limitation on deductions for an individual with self-only coverage under a high deductible health plan remains unchanged at $3,350.  For calendar year 2016, the annual limitation on deductions for an individual with family coverage under a high deductible health plan will increase $100 to $6,750.

A “high deductible health plan”, for calendar year 2016, is defined as a health plan with an annual deductible that is not less than $1,300 for self-only coverage, or $2,600 for family coverage, and the annual out-of-pocket expenses (including deductibles, co-payments and other amounts, but not premiums) do not exceed $6,550 for self-only coverage or $13,100 for family coverage.