Industry News

On May 21, 2020, the Internal Revenue Service (IRS) issued Revenue Procedure 2020-32, which provides the 2021 inflation-adjusted amounts for health savings accounts (HSAs) as determined under Internal Revenue Code (IRC) § 223.  For calendar year 2021, the annual limitation on deductions for an individual with self-only coverage under a high-deductible health plan (HDHP) is $3,600.  For calendar year 2021, the annual limitation on deductions for an individual with family coverage under a HDHP is $7,200.

For calendar year 2021, the IRS defines a HDHP under IRC § 223(c)(2)(A) as a health plan with an annual deductible that is not less than $1,400 for self-only 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 $7,000 for self-only coverage or $14,000 for family coverage.

Revenue Procedure 2020-32 is available here.