Prepare for 2025 with the increased HSA contribution limits

It’s that time of year when employers and benefits plan sponsors get a sneak peek at what to expect for benefit contributions limits in 2025. The IRS just released the latest figures for Health Savings Accounts (HSAs) and they represent a slight increase over 2024 amounts.

What are HSA contribution limits?

The IRS establishes the maximum pre-tax contribution limits that individuals and families may make for a calendar year.

What are the 2025 HSA index figures?

On May 8, 2024, the Internal Revenue Service (IRS) released Revenue Procedure 2024-25¹ to provide the new Health Savings Account (HSA) index figures for 2025. Every year, the IRS publishes this early release to help employers and HSA members budget for the upcoming year.

For 2025, the maximum contribution level rises to $4,300 for individuals and to $8,550 for families. Catch-up contributions for those 55 years of age and over hold steady at $1,000.

See the table below for details:

What are the 2025 HRA contribution limits?

In addition to the updated HSA figures, for plan years beginning in 2025, Revenue Procedure 2024-25 provides that the maximum amount that may be made newly available for the plan year in an excepted Health Reimbursement Arrangement (HRA) is $2,150. Plan sponsors should update payroll and plan administration systems for the 2025 cost-of-living adjustments and incorporate the new limits in relevant participant communications, such as open enrollment and communication materials, plan documents, and summary plan descriptions.

What are the 2025 contribution limits for other employee benefits?

The IRS will likely release the remaining index figures—healthcare FSA, Commuter, and more—in the fall of 2024. My team watches for this second information release and will update you when we have it. Unfortunately, this information typically lands while most organizations are full swing into the open enrollment season. We wish we could change this and have all the information released at once, but the two-step process will remain the same until legislative change happens.

Using the information in this summary to plan for 2025

It’s important to note that my summary here is purely to help educate you—employers and plan sponsors—on what you might expect due to the recent IRS guidance on employee benefit plans. This summary is not and should not be construed as legal or tax advice. Please take it from me, the government’s guidance is complex and very fact specific. As always, employers and plan sponsors are strongly encouraged to consult competent legal or benefits counsel for all guidance on how the actions apply in their circumstances.