IRS Announces 2026 Health Savings Accounts Contribution Limits — What Investors Should Know
The IRS has released updated contribution limits for Health Savings Accounts (HSAs) for 2026, offering increased opportunities for tax-advantaged savings.
Higher Contribution Limits For 2026
Starting in 2026, individuals with self-only high-deductible health coverage can contribute up to $4,400 to an HSA, up from $4,300 in 2025. For those with family coverage, the limit rises to $8,750, an increase from $8,550. These adjustments are based on inflation.
To qualify, you must be enrolled in a high-deductible health plan (HDHP). For 2026, the IRS defines a HDHP as having a minimum deductible of $1,700 for individuals and $3,400 for families. The maximum out-of-pocket expenses are set at $8,500 for self-only coverage and $17,000 for family plans.
Triple-Tax Benefits Make HSAs A Powerful Tool
HSAs offer unique tax advantages:
- Contributions are tax-deductible.
- Investment growth is tax-free.
- Withdrawals for qualified medical expenses are also tax-free.
Unlike flexible spending accounts (FSAs), HSA balances roll over year to year and remain with you if you change jobs — making them a valuable long-term savings vehicle, especially for retirement health costs.
“Your HSA is a very powerful tool for retirement planning,” says Dan Galli, CFP and founder of Daniel J. Galli & Associates. According to Fidelity, a 65-year-old retiring in 2024 may need $165,000 for medical expenses in retirement, not including long-term care.
Most Still Use HSAs For Current Expenses
Despite the benefits, many Americans still use their HSAs to cover immediate healthcare needs. A 2024 survey by the Plan Sponsor Council of America found that while two-thirds of employers offer HSA investment options, only 18% of participants were actually investing their balances — a slight decline from the prior year.
“Most participants are still using their HSA for current health-care expenses,” said Hattie Greenan, director of research at the organization.
Key Deadline
HSA contributions for the 2026 tax year can be made up until April 2027.
Source: CNBC
