IRS Raises 2026 Hsa Contribution Limits amid Inflation Adjustments

The IRS has announced higher contribution limits for health savings accounts (HSAs) for 2026, increasing thresholds for both individual and family coverage as part of its annual inflation adjustments.

On May 1, 2025, the Internal Revenue Service (IRS) confirmed that the 2026 HSA contribution limit will rise to $4,400 for individuals with self-only health coverage, up from $4,300 in 2025. For those with family coverage, the limit will increase to $8,750, compared to $8,550 the prior year.

Calculator and notepad on dollar bills | Source: Pexels

To be eligible to contribute to an HSA in 2026, individuals must be enrolled in a qualifying high-deductible health insurance plan. For that year, a high-deductible plan is defined as one with a minimum deductible of $1,700 for self-only coverage or $3,400 for families. The maximum out-of-pocket expense caps are set at $8,500 for individuals and $17,000 for families.

HSAs offer triple tax benefits, which make them attractive for both current and future medical expenses. "Your health savings account has three tax benefits," said Dan Galli, a certified financial planner. "There's typically an upfront deduction for contributions, your balance grows tax-free, and you can withdraw the money any time tax-free for qualified medical expenses."

A person visiting a doctor | Source: Pexels

Unlike flexible spending accounts (FSAs), HSA funds roll over year to year and remain accessible when changing employers. Financial advisors often recommend investing the HSA balance for long-term growth, especially to cover healthcare costs in retirement. Fidelity estimates that a single 65-year-old person retiring in 2024 may spend an average of $165,000 on medical expenses in retirement.

However, most account holders still use HSAs for immediate expenses. A 2024 survey by the Plan Sponsor Council of America found that while 66% of companies offer investment options, only 18% of participants invest their HSA funds.