The IRS recently announced the 2025 inflation adjustments for health savings accounts (HSAs) and health reimbursement arrangements (HRAs), reflecting the ongoing economic conditions. The adjustments show an increase in allowable contributions and cost thresholds for high-deductible health plans (HDHPs), which could impact financial planning for those utilizing these accounts.
For individuals with self-only HDHP coverage, the maximum HSA contribution limit will rise to $4,300, up from $4,150. Those with family HDHP coverage will see their limit increase to $8,550 from $8,300. Additionally, the minimum deductible for an HDHP will increase slightly, as will the maximum out-of-pocket expenses allowed under the plan.
Moreover, the limit for excepted benefit HRAs will increase to $2,150, up from $2,100. These adjustments are important for tax planning and maximizing the benefits of HSAs and HRAs. Clients should consider adjusting their contributions to take full advantage of the tax benefits provided by higher contribution limits and prepare for increased health care costs associated with higher deductible and out-of-pocket limits.
Keeping up with these changes is crucial for optimizing healthcare spending and savings strategies in the coming year. For more detailed information and assistance with healthcare planning and tax strategies, feel free to reach out to our team.