Brendan Willmann, CPA, EA, CFP®
Asheville: 828-348-8698
Cincinnati: 513-549-2736

Health Savings Account Contribution Limits for 2016

October is a popular month for benefit enrollment.  An increasing number of employees are electing high deductible medical insurance plans that are coupled with a health savings account.

You are highly incentivized to contribute to a health savings account as contributions are tax-deductible and qualified distributions are tax-free.  Open enrollment gives you the opportunity to specify the amount you would like to contribute from each paycheck in the coming year.

The contribution limit for 2016 depends on the type of coverage.  For an individual, the maximum contribution is $3,350.  For a family the limit is $6,750.  An additional “catch-up” contribution of $1,000 can be made by account owners ages 55 and older.

Please note that the health savings account limits mentioned above include both employee contributions and and employer contributions.  For example, John, age 40, has family coverage.  His contribution limit is thus $6,750.  If his employer contributes $1,000, John can only personally contribute $5,750 via payroll.

 

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The articles presented on this blog are general in nature and should not be assumed to be applicable to your situation. In addition, tax law changes daily and the articles on this blog are not updated to reflect these changes. Anyone receiving any part of the information on this blog should not rely on or act or refrain from acting on the basis of any matter or information contained in this blog without seeking appropriate tax, legal or other professional advice. The transmission and receipt of information contained on this blog does not form or constitute a client relationship. Nothing in this blog constitutes legal advice. Opinions rendered by tax professionals are not authority.  You agree to hold Brendan Willmann, EA, forever harmless from any liability for your use or failure to use the information, advice, referrals, or suggestions provided by this blog at any time. 

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