IRS boosts health savings account contribution limits for 2025

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IRS boosts health savings account contribution limits for 2025

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The IRS has unveiled the 2025 contribution limits for health savings accounts, which are triple-tax advantaged for medical expenses.

The new

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for 2025 will be $4,300 for self-only health coverage, up from $4,150 in 2024, based on inflation adjustments, the IRS announced on Thursday.

The contribution limit will also increase for savers with family coverage. In 2025, those with family plans can ******** up to $8,550 into HSAs, which is up from $8,300 in 2024.

The IRS will release the 2025 catch-up contribution for savers age 55 and older later this year. It currently stands at $1,000 for 2024, unchanged from 2023.

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You must have an eligible high-deductible health insurance plan to make HSA contributions. The IRS defines “high-deductible” as at least $1,650 for self-only plans or $3,300 for family coverage for 2025.

HSAs offer three tax benefits. There’s an upfront deduction for contributions, investments grow tax-free and there are no levies for withdrawals used for qualified medical expenses.

However, only 19% of HSA participants

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, meaning the vast majority forgo growth by leaving savings in cash, according to a 2023 survey from the Plan Sponsor Council of America.

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