From a planning standpoint, the beginning of the year is important for employers in many ways. It also marks a new beginning for certain benefit components–including several account limits set by the IRS. The IRS announced 2021 changes to health savings accounts back in May, but only recently unveiled annual changes to flexible savings accounts and 401(k)s. From contribution limits to out-of-pocket amounts, here are 11 figures employers need to know–all of which come into play in January.
$19,500: 401(k) pretax contribution limits
$6,500: 401(k) catch-up contribution limit
For participants age 50 and over, the additional 401(k) catch-up contribution limit, which is set by law, is staying at $6,500 for 2021.
$3,600: Annual HSA contribution limit for individuals
In 2021, the annual HSA contribution limit will rise to $3,600 for individuals in a high-deductible plan, the IRS said. That’s up from $3,550 in 2020.
$7,200: HSA contribution limit for family coverage
Those with family plans will be able to stash up to $7,200 in 2021–up from $7,100 in 2020.
$1,000: HSA catch-up contributions
Individuals 55 or older can contribute an extra $1,000 to their health savings account in 2021. The amount remains unchanged from 2020.
$1,400: HDHP minimum deductible for individuals
The minimum deductible for a qualifying high-deductible health plan will remain unchanged and stay at $1,400 for self-only coverage.
$2,800: HDHP minimum deductible for family
The minimum deductible for a qualifying high-deductible health plan will remain unchanged and stay at $2,800 for family coverage.
$7,000: HDHP maximum out-of-pocket amounts (individuals)
Deductibles, copayments and other amounts that do not include premiums will have a maximum limit of $7,000 for individual coverage next year, up $100 from 2020.
$14,000: HDHP maximum out-of-pocket amounts (family)
$2,750: FSA contribution limit
The dollar limit for employee contributions to flexible spending accounts, made on a pretax basis through salary reductions, remains unchanged for 2021 at $2,750.
$550: FSA carryover amount limit
For health FSA plans that permit the carryover of unused amounts, the maximum carryover amount for 2021 is $550, an increase of $50 from the original 2020 carryover limit.