IRS Announces New 2020 Limits for FSA, HSA, HDHP, and Transportation Plans

The IRS released on November 6, 2019, Revenue Procedure 2019-44 (PDF) with cost-of-living adjustments for tax-related amounts indexed for inflation. The IRS also announced the health savings account (HSA) and high deductible health plan (HDHP) annual deductible and out-of-pocket expense adjustments earlier this year in Revenue Procedure 2019-25.

 

New FSA Maximums

The maximum amount participants may contribute to the Health Care (and Limited Purpose) Flexible Spending Accounts in 2020 was increased to $2,750 (up from $2,700 in 2019). Additionally, the Dependent Care FSA maximum has remained at $5,000 for 2020. The Adoption Credit Limit has increased to $14,300 from $14,080. For plans with a non-calendar year effective date, the new maximum becomes effective with the next plan year. 

 

New HSA Maximums

In 2020, individuals with self-only coverage will have a maximum of $3,550 (raised from $3,500 in 2019) to contribute to a Health Savings Account. Individuals with family coverage will have a maximum of $7,100 in 2020 (raised from $7,000 in 2019). The HSA Catch-Contribution Limit has remained at $1,000 both in 2019 and 2020.

 

New HDHP Maximums

The Minimum Annual Deductible for individuals with self-only coverage will increase from $1,350 to $1,400 and those with family coverage with have a minimum of $2,800, increased from $2,700. The Out-of-Pocket Expense Maximum increased from $6,750 to $6,900 for individuals and $13,500 to $13,800 for families.

 

New Transportation Maximums

The maximum monthly amounts participants may contribute to TSA Parking and Mass Transit plans has  increased to $270 for each account (up from $265 each in 2019). 

 

Please reference the chart below for direct comparisons related to respective plans:

Welfare Plan Limits

  Plan

2020

2019

  Health FSA Max

$2,750

$2,700

  Dependent Care FSA Max

$5,000

$5,000

  Adoption Credit Limit

$14,300

$14,080

  HDHP Min Annual Deductible (Single)

$1,400

$1,350

  HDHP Min Annual Deductible (Family)

$2,800

$2,700

  HDHP Out of Pocket Max (Single)

$6,900

$6,750

  HDHP Out of Pocket Max (Family)

$13,800

$13,500

  HSA Max Contribution Limit (Single)

$3,550

$3,500

  HSA Max Contribution Limit (Family) 

$7,100

$7,000

  HSA Catch-Contribution Limit (Not Indexed)

$1,000

$1,000

  TSA Parking and Mass Transit Monthly Limit

$270

$265

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