The IRS announced small increases to health savings account (HSA) contribution limits for 2020 and a new definition for a high-deductible health plan.
The IRS issued Revenue Procedure 2019-25, which provides the 2020 inflation-adjusted amounts for HSAs as determined under Section 223 of the Internal Revenue Code (IRC).
For calendar year 2020, the maximum annual contribution to an HSA for individual coverage under a high deductible health plan is $3,550. For calendar year 2020, the maximum annual contribution to an HSA for family coverage under a high deductible health plan is $7,100. These are increases of $50 and $100, respectively, from the 2019 contribution limits.
For calendar year 2020, a high deductible health plan is defined under Section 223(c)(2)(A) as a health plan with an annual deductible that is not less than $1,400 for individual coverage or $2,800 for family coverage, and the annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not premiums) do not exceed $6,900 for individual coverage or $13,800 for family coverage.
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