What investors need to know
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The IRS announced 2027 contribution limits for health savings accounts, or HSAs, which offer investors a triple tax benefit.
new from 2027 HSA contribution limit It will be $4,500 for individual plans only, down from $4,400 in 2026 based on the latest inflation adjustments.
The HSA limit for family insurance will also increase in 2027. According to the report, this limit will increase from $ 8,750 to $ 9,000 in 2026. IRS announcement It was published on Friday.
HSAs offer three tax benefits: Contributions are tax-deductible, funds are tax-free, and you don’t pay taxes on withdrawals for qualified medical expenses.
However, to contribute, you must have an eligible, high-deductible health insurance plan. Approximately 31% of companies offering employee health insurance are offered HSA-eligible high-deductible health plans By 2025, according to health policy research group KFF.
Many Americans also purchased these plans through the Affordable Care Act health insurance marketplace.
more than that 59 million Americans Had an HSA as of Dec. 31, 2024, according to a survey published in July by Devenir, a company that provides HSA investment solutions and research, and the American Bankers Association’s Health Savings Account Council. The top 20 HSA providers participated in the survey.
Two thirds of employers offered investment options for HSA contributions in 2024, according to the Plan Sponsor Council of America’s 2025 HSA survey of nearly 600 U.S. employers, released in September. However, only 20% of HSA participants invested their assets; this rate was 18% in 2023.
“The reality is that many people need to access their funds for current expenses,” Hattie Greenan, director of research and communications for the Plan Sponsor Council of America, previously told CNBC.
Republicans focus on HSA expansion
Congressional Republicans are increasingly focusing on HSAs due to rising health care costs.
Trump’s legislation did not extend increased subsidies for marketplace health insurance, which lowers the cost of premiums. The larger pandemic-era tax credit expired after 2025, leaving millions of Americans uninsured.
In December, Senate Republicans floated the idea of prepaid HSAs to partially offset the cost of expiring HSA subsidies. But some policy experts HSA criticizes expansion proposals.
“HSAs provide the biggest tax breaks to high-income earners who can afford to contribute to the account and leave the money there to earn tax-free investment gains over time,” said Nicole Rapfogel, senior policy analyst at the Center on Budget and Policy Priorities. In a blog post in February he wrote:.
Meanwhile, as the November midterm elections approach and Republicans struggle to maintain slim majorities in the House and Senate, affordability, including the cost of health care, has become a major issue.
