HSA Limits Updated For 2020

June 11, 2019

On May 29, 2019, the IRS released Rev. Proc 2019-25, which provides the 2020 inflation-adjusted limits for HSAs and HSA-qualifying HDHPs. According to the revenue procedure, the 2020 annual HSA contribution limit will increase to $3,550 for individuals with self-only HDHP coverage (up $50 from 2019) and to $7,100 for individuals with anything other than self-only HDHP coverage (family or self+1, self+child(ren), or self + spouse coverage) (up $100 from 2019).

For qualified HDHPs, the 2020 minimum statutory deductibles increase to $1,400 for self-only coverage (up $50 from 2019) and $2,800 for individuals with anything other than self-only coverage (up $100 from 2019). The 2019 maximum out-of-pocket limits increased to $6,900 for self-only coverage (up $150 from 2019) and up to $13,800 for anything other than self-only coverage (up $300 from 2019). Out-of-pocket limits on expenses include deductibles, copayments, and coinsurance, but not premiums.

The 2020 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 2020 limits.

Rev. Proc. 2019-25 ยป