The IRS recently released the 2026 inflation-adjusted amounts for Health Savings Accounts (HSAs). Employees will be able to save a modest amount more in their HSAs next year. These amounts are adjusted each year, based on inflation, and the adjustments are announced earlier in the year than other inflation-adjusted amounts, which allows employers to get ready for the next year.
Fundamentals of a Health Savings Account
An HSA is a trust that is designed to pay for the “qualified medical expenses” of an “account beneficiary.” It can only be set up for an “eligible individual” who is covered under a “high-deductible health plan.” It’s important to note that Medicare enrollees or those with other health coverage (with the exception of dental, vision, long-term care, accident, and specific disease insurance) are not eligible to participate.
Individuals can deduct above-the-line contributions to a Health Savings Account within specified dollar limits. This annual contribution limitation and the annual deductible and out-of-pocket expenses under the tax code are adjusted annually for inflation.
Inflation adjustments for 2026
In Revenue Procedure 2025-19, the IRS released the 2026 inflation-adjusted figures for contributions to Health Savings Accounts, which are as follows:
Annual contribution limitation: For calendar year 2026, the annual contribution limit for an individual with self-only coverage under an HDHP will be $4,400. For an individual with family coverage, the amount will be $8,750. These are up from $4,300 and $8,550, respectively, in 2025.
There’s an additional $1,000 “catch-up” contribution amount for those age 55 or older in 2026 (and 2025).
High deductible health plan limits: An HDHP is generally a plan with an annual deductible that isn’t less than $1,700 for self-only coverage and $3,400 for family coverage in 2026 (up from $1,650 and $3,300, respectively, in 2025). In addition, in 2026, the sum of the annual deductible and other annual out-of-pocket expenses required to be paid under the plan for covered benefits (but not for premiums) can’t exceed $8,500 for self-only coverage and $17,000 for family coverage. In 2025, these amounts are $8,300 and $16,600, respectively.
Health Reimbursement Arrangements
The IRS also announced an inflation-adjusted amount for Health Reimbursement Arrangements (HRAs). An HRA must receive contributions from an eligible individual (employers can’t contribute). Contributions aren’t included in income, and HRA reimbursements used to pay eligible medical expenses aren’t taxed. In 2026, the maximum amount that may be made newly available for the plan year for an excepted benefit HRA will be $2,200 (up from $2,150 in 2025).
Advantages of Health Savings Accounts
There are a variety of benefits to HSAs. Pre-tax contributions are made to the accounts. This money can accumulate tax-free year after year, and it can be withdrawn tax-free to pay for various medical expenses, including doctor’s visits, prescriptions, chiropractic care, and long-term care insurance premiums. In addition, a Health Savings Account has the benefit of being “portable,” meaning it remains with the account holder even if they switch employers or retire. Many employers find it to be a fringe benefit that attracts and retains employees. If you have any inquiries about implementing HSAs for your business, contact us or one of Landmark Financial’s Certified Employee Benefit Specialists.
© 2021. Updated May 2025.