2024 Key Numbers for Health Savings Accounts
The IRS recently released the 2024 contribution limits for health savings accounts (HSAs), as well as the 2024 minimum deductible and maximum out-of-pocket amounts for high-deductible health plans (HDHPs).
What is an HSA?
An HSA is a tax-advantaged account that enables you to save money to cover health-care and medical costs that your insurance doesn’t pay. The funds contributed are made with pre-tax dollars if you contribute via payroll deduction or are tax deductible if you make them yourself using after-tax dollars. (HSA contributions and earnings may or may not be subject to state taxes.) Withdrawals used to pay qualified medical expenses are free from federal income tax.
You can establish and contribute to an HSA only if you are enrolled in an HDHP, which offers “catastrophic” health coverage and pays benefits only after you’ve satisfied a high annual deductible. Typically, you will pay much lower premiums with an HDHP than you would with a traditional health plan such as an HMO or PPO.
If HSA withdrawals are not used to pay qualified medical expenses, they are subject to ordinary income tax and a 20 percent penalty. When you reach age 65, you can withdraw money from your HSA for any purpose; such a withdrawal would be subject to income tax if not used for qualified medical expenses, but not the 20 percent penalty.
What’s changed for 2024?
Here are the updated key tax numbers relating to HSAs for 2023 and 2024.
| Health Savings Accounts | 2023 | 2024 |
| Annual contribution limit | ||
| Self-only coverage | $3,850 | $4,150 |
| Family coverage | $7,750 | $8,300 |
| High-deductible health plan: self-only coverage | ||
| Annual deductible: minimum | $1,500 | $1,600 |
| Annual out-of-pocket expenses required to be paid (other than for premiums) can’t exceed | $7,500 | $8,050 |
| High-deductible health plan: family coverage | ||
| Annual deductible: minimum | $3,000 | $3,200 |
| Annual out-of-pocket expenses required to be paid (other than for premiums) can’t exceed | $15,000 | $16,100 |
| Catch-up contributions | ||
| Annual catch-up contribution limit for individuals age 55 or older | $1,000 | $1,000 |
Important Disclosures:
Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
The information provided is not intended to be a substitute for specific individualized tax planning or legal advice. We suggest that you consult with a qualified tax or legal professional.
LPL Financial Representatives offer access to Trust Services through The Private Trust Company N.A., an affiliate of LPL Financial.
This article was prepared by Broadridge.
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