Compliance Corner

Federal Updates

IRS Releases 2024 Contribution Limits for HSAs and HRAs

May 23, 2023

On May 16, 2023, the IRS released Revenue Procedure 2023-23, which provides the 2024 inflation-adjusted limits for HSAs and HSA-qualifying HDHPs. According to the revenue procedure, the 2024 annual HSA contribution limit will increase to $4,150 for individuals with self-only HDHP coverage (up $300 from 2023) and to $8,300 for individuals with anything other than self-only HDHP coverage (family or self +1, self + child(ren), or self + spouse/domestic partner coverage), an increase of $550 from 2023.

For qualified HDHPs, the 2024 minimum statutory deductibles will be $1,600 for self-only coverage (up $100 from 2023) and $3,200 for individuals with anything other than self-only coverage (an increase of $200 from 2023). The 2024 maximum out-of-pocket limits will increase to $8,050 for self-only coverage (up $550 from 2023) and up to $16,100 for anything other than self-only coverage (up $1,100 from 2023). For reference, out-of-pocket limits on expenses include deductibles, copayments and coinsurance, but not premiums. Additionally, the catch-up contribution maximum remains $1,000 for individuals aged 55 years or older (this is a fixed amount not subject to inflation).

The maximum amount that may be made newly available for plan years beginning in 2024 for excepted benefit HRAs is $2,100 (up $150 from 2023).

The 2024 limits may impact employer benefit strategies, particularly for employers coupling HSAs with HDHPs. Employers should ensure that employer HSA contributions and employer-sponsored qualified HDHPs are designed to comply with the 2024 limits.

Revenue Procedure 2023-23 ยป