You can contribute up to $6,900 in your Health Savings Account (HSA) this year, after the IRS reversed a decision it made in March that capped contributions at $6,850.

That’s the family contribution level. For individuals, the limit is $3,450 for 2018, and the catch-up contribution limit for those 55 or older is $1,000.

The confusion happened, per Kiplinger’s, because the IRS had calculated 2018 contribution levels before the GOP passed the Tax Cuts and Jobs Act. But that bill ties the inflation adjustment amount to a different version of the Consumer Price Index, and the new version “has grown at a slower rate than the CPI version used in the past.” The IRS recalculated and announced that $6,850 was the new limit, but that caused problems for people who had already contributed the maximum amount, causing the agency to reverse course again.


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So if you withdrew $50 from your account after the March decision, Kiplinger’s reports that you can add it back without taxes or penalties. The contribution limits for 2019 will likely be announced in the next month.

HSAs are tax-advantaged medical savings accounts tied to high-deductible health plans (HDHPs). To be eligible for one, your health care plan must have a minimum deductible of $1,350 and maximum out-of-pocket costs of $6,650 for individuals, and a minimum deductible of $2,700 for families and maximum out-of-pocket costs of $13,300.

Flexible Spending Accounts (FSAs), on the other hand, are not tied to high-deductible plans and employees can contribute up to $2,650 in 2018.



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