2027 Health Savings Account Limits

The Health Savings Account (H.S.A) contribution limits for 2027 are $4,500 for self-only coverage and $9,000 for family coverage. Those 55 and older can contribute an additional $1,000 as a catch-up contribution.

What's so great about the HSA.

(1)       Contributions to an H.S.A are tax-deductible for Federal purposes, so they reduce your federal income taxes owed. Some companies offer a pre-tax payroll deduction. Other companies have no pre-tax deduction and your deduction is claimed on your tax return.

(2)        Investments earnings in your H.S.A. account grow tax-free at the federal level.

(3)        Funds can be withdrawn tax-free if you use them for qualified medical expenses.

Together, the benefits of pre-tax contributions, tax-free earnings, and tax-free withdrawals for qualified medical expenses can add up to significant savings over the course of a family’s life if they are healthy and let the funds accumulate. So think of the H.S.A. as a piggy bank for medical expenses that can grow similar to an Individual Retirement Account (IRA).

 (4) Another bonus is that many employers want you to join a high-deductible insurance plan so they save on premiums. To entice you, many employers will make a tax-free contribution to your H.S.A.