What Are the New Contribution Limits for Health Savings Accounts in 2024?
Key takeaways:
For 2024, the health savings account (HSA) contribution limits are $4,150 for individual coverage and $8,300 for family coverage.
You can only contribute to an HSA during months that you are considered HSA eligible. If you were not eligible to contribute to an HSA for the full tax year, you will have to prorate your contributions.
The deadline to contribute to your HSA for the 2024 tax year is April 15, 2025, unless the IRS provides an extension.
The contribution limits for health savings accounts (HSAs) are increasing in 2024. By contributing the maximum amount, you can reduce your tax bill and save more money on qualified medical expenses. And if you don’t need to use your HSA dollars in the current year, the money in your account can roll over to next year.
What are the HSA contribution limits for 2024?
For 2024, individuals can contribute a maximum of $4,150 to an HSA. If you have family coverage, you can contribute up to $8,300. And if you are 55 or older, the IRS allows you to contribute an additional $1,000.
If your employer offers an HSA, you can set up automatic contributions from your paycheck to your HSA every pay period. If you are self-employed, you can add funds to your account directly and deduct the contributions on your tax return.
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You can contribute money to your 2024 HSA anytime before April 15, 2025, which is the 2024 tax filing deadline. If the tax deadline falls on a holiday or the IRS provides you with an extension, this date will be different.
How do I calculate my maximum HSA contribution for 2024?
Depending on when you become eligible for an HSA, you may not be able to contribute the maximum annual amount. You can only contribute to an HSA during the months you are considered HSA eligible, unless you qualify for the HSA last-month rule.
Take, for example, the following scenario. Suppose you:
Are 45 years old
Have individual coverage
Were enrolled in a qualified high-deductible health plan (HDHP) for 6 months in 2024
Since you did not have HSA-eligible coverage for the full tax year, you will need to prorate your contribution amount based on the number of months you were eligible. In this case, you can contribute up to 50% of the HSA contribution limit since you were enrolled in a qualified HDHP for half the year. Instead of contributing $4,150 to your HSA, you are allowed to contribute up to $2,075 in 2024.
How do the HSA contribution limits for 2024 compare to the ones from 2023?
The HSA contribution limits increased from 2023 to 2024. For 2024, the HSA contribution limit is $4,150 for an individual, up from $3,850 in 2023. You can contribute up to $8,300 to a family HSA for 2024, up from $7,750 in 2023.
Below is an infographic that shows the changes in contribution limits from 2023 to 2024.
What expenses are HSA eligible for 2024?
An HSA can help pay for medical expenses that your health insurance doesn’t cover. This can include copays and deductibles. You can also use tax-free money to pay for qualified medical expenses such as:
Blood pressure monitors
Body scans
Doctor visits
Eye drops
Menstrual care products
Prescription contact lenses
Sleep aids
A wheelchair
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Will money in your HSA roll over from last year?
Yes, if you don’t spend all your HSA dollars by the end of the year, your money will roll over from year to year and accumulate over time. Unlike flexible spending accounts (FSAs), HSAs do not have a “use it or lose it” rule. The money in your HSA will not expire.
The bottom line
The health savings account (HSA) contribution limits increased from 2023 to 2024. For 2024, you can contribute up to $4,150 if you have individual coverage, up from $3,850 in 2023. If you have family coverage, you can contribute up to $8,300, compared to $7,750 in 2023.
Since you’re only allowed to contribute to an HSA during the months you have an HSA-compatible insurance plan, it’s important to review your health plan to ensure you meet the requirements. If you are not HSA eligible for the entire year or do not qualify for the last-month rule, you will need to prorate your contribution amount based on the number of months you were eligible.
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References
Internal Revenue Service. (n.d.). Rev. proc. 2023-23.
