The Treasury Department and Internal Revenue Service issued 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 2009 and are included in Revenue Procedure 2008-29, 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:
- For 2009, the maximum annual HSA contribution for an eligible individual with self-only coverage is $3,000.
- For family coverage, the maximum annual HSA contribution is $5,950.
Catch up contribution for individual who are 55 or older is increased by statute to $1,000 for 2009 and all years going forward.
- Individuals who are eligible individuals on the first day of the last month of the taxable year (December for most taxpayers) are allowed the full annual contribution (plus catch up contribution, if 55 or older by year end), regardless of the number of months the individual was an eligible individual in the year. For individuals who are no longer eligible individuals on that date, 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.
New Amounts for Out-of-Pocket Spending on HSA-Compatible HDHPs:
- For 2009, the maximum annual out-of-pocket amounts for HDHP self-coverage increase to $5,800 and the maximum annual out-of-pocket amount for HDHP family coverage is twice that, $11,600.
Minimum Deductible Amounts for HSA-Compatible HDHPs:
- For 2009, the minimum deductible for HDHPs increases to $1,150 for self-only coverage and $2,300 for family coverage.
In addition, 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.
Revenue Procedure 2008-29Part III
Administrative, Procedural, and Miscellaneous
26 CFR 601.602: Tax forms and instructions.
(Also: Part 1, §§ 1, 223.)
Rev. Proc. 2008-29
SECTION 1. PURPOSE
This revenue procedure provides the 2009 inflation adjusted amounts determined
under § 223(g) of the Internal Revenue Code for Health Savings Accounts (HSAs).
SECTION 2. 2009 INFLATION ADJUSTED ITEMS
Annual contribution limitation. For calendar year 2009, the annual limitation on
deductions under § 223(b)(2)(A) for an individual with self-only coverage under a high
deductible health plan is $3,000. For calendar year 2009, the annual limitation on
deductions under § 223(b)(2)(B) for an individual with family coverage under a high
deductible health plan is $5,950.
High deductible health plan. For calendar year 2009, a “high deductible health
plan” is defined under § 223(c)(2)(A) as a health plan with an annual deductible that is
not less than $1,150 for self-only coverage or $2,300 for family coverage, and the
annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not
premiums) do not exceed $5,800 for self-only coverage or $11,600 for family coverage.
SECTION 3. EFFECTIVE DATE
This revenue procedure is effective for calendar year 2009.
SECTION 4. DRAFTING INFORMATION
The principal author of this revenue procedure is Marnette M. Myers of the Office
of Associate Chief Counsel (Income Tax & Accounting). For further information
regarding § 223 and HSAs, contact Elizabeth Purcell at (202) 622-6080 (not a toll free
call). For further information regarding the calculation of the inflation adjustments in this revenue procedure contact Ms. Myers at (202) 622-4920 (not a toll free call).