Straight-From-the-Source-Blog-Header.png

IRS Announces Change to 2018 HSA Family Contribution Limit

By Higginbotham on March 06 , 2018

Compliance-Update-Blog.png

On March 5, 2018, the IRS published Internal Revenue Bulletin (IRB) 2018-10 that contains Revenue Procedure (Rev. Proc.) 2018-19.

Effective for calendar year 2018, the family contribution limit for HSAs has been lowered to $6,850 from the previously set amount of $6,900. This change came as a result of the tax reform law (P.L. 115-97) that changed the annual inflation adjustment factor from the Consumer Price Index (CPI) to a new factor known as "chained CPI." This change was anticipated to slow the rate of changes in all programs under the tax code, including HSAs.

Employers with HDHPs should inform employees about the reduced HSA contribution limit for family HDHP coverage. Employees may need to change their HSA elections going forward to comply with the new limit. Also, any individuals with family HDHP coverage who have already contributed $6,900 for 2018 must receive a refund of the excess contribution in order to avoid an excise tax.

If you are a Higginbotham HSA client, we are in the process of updating our WealthCare Administration Portal and Mobile sites with the new limits. If you use a different outside vendor to administer your HSA, you will need to contact them or your payroll provider to reflect the new limits.

For answers to questions or more information, please contact your Higginbotham representative.

Subscription-Blog-CTA-1.png

 

Tags: Compliance

  
SUBSCRIBE TO NEWSLETTERS

Follow us on Twitter