Health Savings Accounts

Client Alert: IRS Announces 2023 Adjustments for HSAs & Excepted Benefit HRAs

The IRS has released its 2023 annual inflation adjustments for Health Savings Accounts (“HSAs”) as determined under Section 223 of the Internal Revenue Code. Specifically, IRS Revenue Procedure 2022-24 provides the adjusted limits for contributions to a HSA, as well as the high deductible health plan (“HDHP”) minimums and maximums for calendar year 2023.

Additionally, Revenue Procedure 2022-24 sets forth the maximum amount that may be made newly available for excepted-benefit health reimbursement arrangements (“HRAs”) as provided under 26 CFR 54.9831-1(c)(3)(viii).

The 2023 HSA/HDHP limits are as follows:

Annual Contribution Limit
- Single Coverage: $3,850
- Family Coverage: $7,750
HDHP-Minimum Deductible
- Single Coverage: $1,500
- Family Coverage: $3,000
HDHP-Maximum Annual Out-of-Pocket Expenses (including deductibles, co-payments and other amounts, but not including premiums)
- Single Coverage: $7,500
- Family Coverage: $15,000
The catch-up contribution for eligible individuals age 55 or older by year end remains at $1,000.

Plans and related documentation, including employee communications, should be updated to reflect these new limits which are effective for calendar year 2023.

As always, please keep in mind that participation in a health FSA (or any other non-HDHP) will result in HSA ineligibility, unless the health FSA is limited to: (1) limited-scope dental or vision excepted benefits; and/or (2) post-deductible expenses.

The 2023 EBHRA limit is as follows:

The maximum amount that may be made newly available for the plan year for an excepted benefit HRA (“EBHRA) is $1,950. This amount is effective for plan years beginning in 2023.

If you have any questions about these products or would like assistance with updating documentation or employee communications, feel free to contact us.

As you are well aware, the law and guidance are rapidly evolving in this area. Please check with your Fraser Trebilcock attorney for the most recent updates.

This alert serves as a general summary, and does not constitute legal guidance. Please contact us with any specific questions.

Aaron L. Davis works in employee health and welfare benefits. He is also Chair of the firm’s labor law practice and serves as Firm Secretary. He has litigation experience in a diverse range of employment matters, including Title VII, the Age Discrimination and Employment Act, the Americans with Disabilities Act, the Family Medical Leave Act, and the Fair Labor Standards Act. You can reach him at 517.377.0822, or email her at adavis@fraserlawfirm.com.

Elizabeth H. Latchana specializes in employee health and welfare benefits. Recognized for her outstanding legal work, in both 2019 and 2015, Beth was selected as “Lawyer of the Year” in Lansing for Employee Benefits (ERISA) Law by Best Lawyers, and in 2017 as one of the Top 30 “Women in the Law” by Michigan Lawyers Weekly. Contact her for more information on this reminder or other matters at 517.377.0826 or elatchana@fraserlawfirm.com.

IRS Announces 2022 Adjustments for HSAs & Excepted-Benefit HRAs

The IRS has released its 2022 annual inflation adjustments for Health Savings Accounts (“HSAs”) as determined under Section 223 of the Internal Revenue Code. Specifically, IRS Revenue Procedure 2021-25 provides the adjusted limits for contributions to a HSA, as well as the high deductible health plan (“HDHP”) minimums and maximums for calendar year 2022.

Additionally, Revenue Procedure 2021-25 sets forth the maximum amount that may be made newly available for excepted-benefit health reimbursement arrangements (“HRAs”) as provided under 26 CFR 54.9831-1(c)(3)(viii).

The 2022 HSA/HDHP limits are as follows:

Annual Contribution Limit
- Single Coverage: $3,650
- Family Coverage: $7,300
HDHP-Minimum Deductible
- Single Coverage: $1,400
- Family Coverage: $2,800
HDHP-Maximum Annual Out-of-Pocket Expenses (including deductibles, co-payments and other amounts, but not including premiums)
- Single Coverage: $7,050
- Family Coverage: $14,100
The catch-up contribution for eligible individuals age 55 or older by year end remains at $1,000.

Plans and related documentation, including employee communications, should be updated to reflect these new limits which are effective for calendar year 2022.

The 2022 EBHRA limit is as follows:

The maximum amount that may be made newly available for the plan year for an excepted benefit HRA (“EBHRA) is $1,800. This amount is effective for plan years beginning in 2022 (but it is unchanged since EBHRA’s inception in 2020).

If you have any questions about these products or would like assistance with updating documentation or employee communications, feel free to contact us.

As you are well aware, the law and guidance are rapidly evolving in this area. Please check with your Fraser Trebilcock attorney for the most recent updates.

Fraser Trebilcock is committed to providing you valuable information. Please watch for upcoming alerts on these and other topics.

We have created a response team to the rapidly changing COVID-19 situation and the law and guidance that follows, so we will continue to post any new developments. You can view our COVID-19 Response Page and additional resources by following the link here. In the meantime, if you have any questions, please contact your Fraser Trebilcock attorney.

Brian T. Gallagher is an attorney at Fraser Trebilcock specializing in ERISA, Employee Benefits, and Deferred and Executive Compensation. He can be reached at (517) 377-0886 or bgallagher@fraserlawfirm.com.

IRS Announces 2021 Increases for HSAs

The IRS has released its 2021 annual inflation adjustments for Health Savings Accounts (HSAs) as determined under Section 223 of the Internal Revenue Code. Specifically, IRS Revenue Procedure 2020-32 provides the adjusted limits for contributions to a Health Savings Account (“HSA”), as well as the high deductible health plan (“HDHP”) minimums and maximums for calendar year 2021.

The 2021 limits are as follows:

Annual Contribution Limit
- Single Coverage: $3,600
- Family Coverage: $7,200
HDHP-Minimum Deductible
- Single Coverage: $1,400
- Family Coverage: $2,800
HDHP-Maximum Annual Out-of-Pocket Expenses (including deductibles, co-payments and other amounts, but not including premiums)
- Single Coverage: $7,000
- Family Coverage: $14,000
The catch-up contribution for eligible individuals age 55 or older by year end remains at $1,000.

Plans and related documentation, including employee communications, should be updated to reflect these new limits for 2021.

This alert serves as a general summary of lengthy and comprehensive new provisions of the Internal Revenue Code. It does not constitute legal guidance. Please contact us with any specific questions.

Client Alert: IRS Announces 2020 Increases for HSAs

The IRS has released its 2020 annual inflation adjustments for Health Savings Accounts (HSAs) as determined under Section 223 of the Internal Revenue Code. Specifically, IRS Revenue Procedure 2019-25 provides the adjusted limits for contributions to a Health Savings Account (“HSA”), as well as the high deductible health plan (“HDHP”) minimums and maximums for calendar year 2020.

The 2020 limits are as follows:

Annual Contribution Limit
- Single Coverage: $3,550
- Family Coverage: $7,100
HDHP-Minimum Deductible
- Single Coverage: $1,400
- Family Coverage: $2,800
HDHP-Maximum Annual Out-of-Pocket Expenses (including deductibles, co-payments and other amounts, but not including premiums)
- Single Coverage: $6,900
- Family Coverage: $13,800
The catch-up contribution for eligible individuals age 55 or older by year end remains at $1,000.

Plans and related documentation, including employee communications, should be updated to reflect these new limits for 2020.