2007 HSA Indexed Amounts

On November 9, 2006, the IRS issued Revenue Procedure 2006-53 , which, among other things, provides the 2007 indexed amounts for the maximum contribution levels for Health Savings Accounts (HSAs), and the minimum deductibles and maximum out-of-pocket spending limits for high deductible Health Plans (HDHPs) that must be used in conjunction with HSAs. The information about HSAs is found on pages 16 and 17 of the revenue procedure.

The new levels are as follows:

New Annual Contribution Levels for HSAs:

• For 2007, the maximum annual HSA contribution for an eligible individual with self-only coverage is $2,850. 
• For family coverage the maximum HSA contribution is $5,650.
• Under recent legislation, these amounts are the maximum HSA contribution amount regardless of the amount of the HDHP deductible.
• Catch up contributions for individuals who are 55 or older is increased by statute to $800 for 2007.
• Both the HSA contribution and catch up contribution apply pro rata based on the number of months of the year a taxpayer is an eligible individual.
• Under recently enacted legislation, if you have HDHP coverage as of December 1, 2007, you are allowed the full, non-pro rated contribution for the year. However, if you cease to remain an eligible individual throughout 2008, the extra amount contributed is included in income and subject to an additional 10 percent tax.

New Amounts for Out-of-Pocket Spending on HSA-Compatible HDHPs:

• The maximum annual out-of-pocket amounts for HDHP self-coverage increase to $5,500 and the maximum annual out-of-pocket amount for HDHP family coverage is twice that, $11,000.

Minimum Deductible Amounts for HSA-Compatible HDHPs:

• For 2007, the minimum deductible for HDHPs increases to $1,100 for self-only coverage and $2,200 for family coverage.

Note that a fiscal year plan that satisfies the requirements for an HDHP on the first day of the first month of its fiscal year may apply that deductible for the entire fiscal year.

Last Updated: January 4, 2007