October 28, 2005
Indexed Amounts for Health Savings Accounts
The Treasury Department and IRS today issued new guidance on the maximum contribution levels for Health Savings Accounts (HSAs) and out-of-pocket spending limits for high deductible Health Plans (HDHPs) that must be used in conjunction with HSAs. These amounts have been indexed for cost-of-living adjustments for 2006 and are included in Revenue Procedure 200r-70, which announces changes in several indexed amounts for purposes of the federal income tax.
The new levels are as follows:
New Annual Contribution Levels for HSAs:
New Amounts for Out-of-Pocket Spending on HSA-Compatible HDHPs:
Minimum Deductible Amounts for HSA-Compatible HDHPs:
Note that a fiscal year HDHP that satisfies the requirements for an HSA-compatible HDHP on the first day of its fiscal year may apply that deductible for the entire fiscal year.