IRS Announces 2024 HSA and EBHRA Contribution Limits
Overview
Welcome to Denaro Anthony D Atty, your leading source for the latest news and updates in the legal and government sector. In this article, we will delve into the recently announced IRS guidelines regarding Health Savings Account (HSA) and Excepted Benefit Health Reimbursement Arrangement (EBHRA) contribution limits for the year 2024. Additionally, we will explore the changes in High Deductible Health Plan (HDHP) minimum deductibles and HDHP out-of-pocket maximums. Stay informed to make sound financial decisions and plan for the future.
What are HSAs and EBHRAs?
Before we dive into the details of the 2024 contribution limits, it is essential to understand what HSAs and EBHRAs are and how they benefit individuals and businesses.
A Health Savings Account (HSA) is a tax-advantaged savings account available to individuals enrolled in a High Deductible Health Plan (HDHP). Contributions to an HSA are tax-deductible and withdrawals for qualified medical expenses are tax-free. HSAs offer individuals the flexibility to save for current and future healthcare expenses while enjoying potential tax savings.
An Excepted Benefit Health Reimbursement Arrangement (EBHRA), on the other hand, is a type of health reimbursement arrangement that provides additional benefits to employees. These benefits are separate from the standard group health plan and can cover expenses such as dental and vision care, long-term care, and more. EBHRAs are often utilized to supplement existing health plans and provide employees with greater health coverage.
2024 Contribution Limits for HSAs
For the year 2024, the IRS has announced the following contribution limits for Health Savings Accounts:
- Individuals with self-only coverage can contribute up to $3,000.
- Individuals with family coverage can contribute up to $6,000.
- Individuals aged 55 or older can make an additional catch-up contribution of $1,000.
It is important to note that these contribution limits may be subject to annual adjustments by the IRS, so it's crucial to stay informed about any changes that may occur in the future.
2024 Contribution Limits for EBHRAs
The IRS has also announced the maximum annual contribution limits for Excepted Benefit Health Reimbursement Arrangements (EBHRAs) for the year 2024. The contribution limits are as follows:
- For self-only coverage, the maximum annual contribution limit is $1,800.
- For family coverage, the maximum annual contribution limit is $3,600.
These contribution limits serve as an important guideline for employers and employees who utilize EBHRAs as part of their health benefit offerings.
Changes in HDHP Minimum Deductibles
Alongside the contribution limits, the IRS has also revised the minimum deductible requirements for High Deductible Health Plans (HDHPs) for the year 2024. The updated minimum deductibles are as follows:
- For self-only coverage, the minimum deductible is $1,400.
- For family coverage, the minimum deductible is $2,800.
These revised minimum deductible amounts signify the minimum out-of-pocket expenses that individuals and families must incur before their HDHP coverage kicks in. Understanding these figures is crucial for making informed decisions about healthcare coverage options.
Changes in HDHP Out-of-Pocket Maximums
Lastly, the IRS has set new out-of-pocket maximum limits for High Deductible Health Plans (HDHPs) in 2024. These limits cap the amount individuals and families are required to pay out-of-pocket for covered medical expenses. The updated HDHP out-of-pocket maximums are as follows:
- For self-only coverage, the out-of-pocket maximum is $7,000.
- For family coverage, the out-of-pocket maximum is $14,000.
By understanding these figures, individuals can assess their financial capabilities and make well-informed decisions about their healthcare coverage.
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