IRS issues new limits for 2009 HSAs

May 22, 2008 — The amount of money individuals who contribute to a Health Savings Account (HSA) will go up in 2009. The Treasury Department and Internal Revenue Service (IRS) have issued new guidance on the maximum contribution levels for  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.

New annual maximum contribution levels for HSAs are:

• Eligible individual with self-only coverage, $3,000; 

• Family coverage, $5,950; and

• Catch-up contribution for individuals who are 55 or older, $1,000 for 2009 and all years going forward.

 Individuals who are eligible 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 eligible during the year.

For individuals who are no longer eligible 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.

The new maximum HDHP contributions for 2009 are:

• $5,800 for self-coverage; and

• $11,600 for family coverage.

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.

 Source: Treasury Department, www.treasury.gov/press/releases/hp975.htm