Great Lakes Wire

Ahola, a company with over five decades of experience in supporting small businesses, has provided updates on Health Savings Accounts (HSAs) for 2025. These updates are essential for both employees and employers looking to maximize healthcare savings.

The Internal Revenue Service (IRS) has increased the contribution limits for HSAs. In 2025, employees can contribute $4,300 for self-only coverage and $8,550 for family coverage. Employees aged 55 or older can make an additional catch-up contribution of $1,000. This adjustment allows employees to save more tax-free money for qualified medical expenses.

HSAs continue to offer significant tax benefits. Contributions are tax-deductible, growth on investments is tax-free, and withdrawals for eligible medical expenses are also tax-free. Employers offering HSAs as part of their benefits package may find it enhances their competitiveness and helps staff manage healthcare costs more efficiently.

Eligibility for contributing to an HSA requires enrollment in a High-Deductible Health Plan (HDHP). For 2025, an HDHP must have a minimum deductible of $1,650 for self-only coverage or $3,300 for family coverage. The maximum out-of-pocket limit is set at $8,300 for self-only coverage or $16,600 for family coverage.

For businesses uncertain about whether their current health plans qualify or if adopting an HDHP plus HSA approach suits them best, Ahola offers guidance to explore available options.

Article courtesy of Ahola.