IRS issues 2017 inflation adjustments for HSAs

The IRS has provided the 2017 inflation adjusted amounts for Health Savings Accounts (HSAs) as determined under Internal Revenue Code Sec. 223.

Annual contribution limitation

For calendar year 2017, the annual limitation on deductions under Code Sec. 223(b)(2)(A) for an individual with self-only coverage under a high deductible health plan is $3,400. The annual limitation on deductions under Code Sec. 223(b)(2)(B) for an individual with family coverage under a high deductible health plan is $6,750.

High deductible health plan

For calendar year 2017, a “high deductible health plan” is defined under Code Sec. 223(c)(2)(A) as a health plan with an annual deductible that is not less than $1,300 for self-only coverage or $2,600 for family coverage, and the annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not premiums) do not exceed $6,550 for self-only coverage or $13,100 for family coverage.

The revenue procedure is effective for calendar year 2017.

For further information regarding Code Sec. 223 and HSAs, contact Karen Levin at (202) 317-5500 (not a toll free call). For further information regarding the calculation of the inflation adjustments in the revenue procedure, contact Mr. Ruane at (202) 317-4718 (not a toll free call). (Rev. Proc. 2016-28, IRB 2016-20, dated May 16, 2016.)

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