In an earlier client alert, we described a problem with the 2018 health savings account (HSA) contribution limit, and indicated that Congress had asked the IRS to implement a specific solution. We're sending you this alert to let you know that yes, the IRS has implemented that solution.
The problem concerns individuals with family medical coverage and the maximum amount that may be contributed to those individuals' HSAs for the 2018 calendar year.
- In May 2017, the IRS announced that for 2018, the maximum HSA contribution for an individual with family medical coverage would be $6,900.
- In March 2018, the IRS reduced the maximum contribution to $6,850. Several members of Congress recently sent a letter to the Treasury Secretary requesting that the $6,900 limit apply for 2018, because individuals and employers had already relied on the earlier announcement.
- On April 26, 2018, the IRS agreed and issued a new Revenue Procedure.
- The $6,900 limit will apply for 2018.
Employers who previously notified their employees of the $6,850 limit should now notify their employees that the limit is $6,900..