Health Savings Accounts have always offered a compelling tax structure. But 2026 brings both higher contribution limits and the broadest expansion of HSA eligibility in recent memory, thanks to amendments the One, Big, Beautiful Bill Act (OBBBA) made to IRC Section 223 when it was signed into law on July 4, 2025.
The basics haven’t changed. What has changed is who qualifies.
2026 Contribution Limits
The IRS released updated figures in Revenue Procedure 2025-19. Self-only coverage increased by $100; family coverage by $200. The catch-up limit, set by statute, remains unchanged at $1,000 and has stayed flat since 2009.
| Coverage Type | 2025 Limit | 2026 Limit | Change |
|---|---|---|---|
| Self-only | $4,300 | $4,400 | +$100 |
| Family | $8,550 | $8,750 | +$200 |
| Catch-up (age 55+) | $1,000 | $1,000 | No change |
Both employee and employer contributions count toward these limits. Where both spouses are 55 or older and not yet enrolled in Medicare, each may make a $1,000 catch-up contribution, but those deposits must go into separate HSAs.
Contributions for a given tax year can generally be made through the April 15 filing deadline of the following year. Clients have until April 15, 2027 to maximize 2026 contributions.
2026 HDHP Requirements
To contribute to an HSA, an individual must be enrolled in a qualifying high-deductible health plan (HDHP). Both the minimum deductible and out-of-pocket maximums increased for 2026.
| HDHP Requirement | Self-Only Coverage | Family Coverage |
| Minimum annual deductible | $1,700 (up from $1,650) | $3,400 (up from $3,300) |
| Maximum out-of-pocket | $8,500 (up from $8,300) | $17,000 (up from $16,600) |
Plans that don’t meet both thresholds generally don’t qualify, with notable exceptions introduced by OBBBA covered below.
The Triple-Tax Advantage
HSAs carry three distinct tax benefits, a combination found nowhere else in the code.
Pre-Tax Contributions
Payroll contributions reduce taxable income dollar-for-dollar. Direct contributions made outside of payroll are deductible above-the-line, regardless of whether the account holder itemizes. Employer contributions are excluded from gross income entirely.
Tax-Free Growth
Interest, dividends, and investment gains accumulate without current tax. Most HSA custodians make investment options available once balances clear a certain threshold, typically somewhere between $1,000 and $2,000.
Tax-Free Qualified Distributions
Withdrawals for qualified medical expenses under Section 213(d) carry no federal income tax. There’s no use-it-or-lose-it rule. Balances carry over indefinitely.
After age 65, HSA funds can be used for any purpose. Non-qualified distributions at that point are subject to ordinary income tax but carry no additional penalty, which makes the account function similarly to a traditional IRA for non-medical uses. Medicare Part B and D premiums, along with eligible long-term care insurance premiums up to the age-based limits under Section 213(d)(10), also qualify as HSA expenses after 65.
What OBBBA Changed
The IRS addressed the OBBBA’s HSA provisions in Notice 2026-5 (December 9, 2025), which walks through three specific eligibility expansions in Q&A format.
Telehealth Safe Harbor, Now Permanent
The CARES Act (2020) created a temporary safe harbor allowing HDHPs to cover telehealth services before the minimum deductible without disqualifying participants from HSA contributions. That provision lapsed for plan years beginning on or after January 1, 2025, creating a coverage gap. OBBBA makes the safe harbor permanent and applies it retroactively to plan years beginning after December 31, 2024.
Participants whose HDHPs provided pre-deductible telehealth coverage in 2025, including those enrolled before the July 4 enactment date, remain eligible to have contributed to their HSAs for that year. Per Notice 2026-5, the safe harbor covers remote services as defined by the Medicare list published annually under Social Security Act Section 1834(m)(4)(F). It does not extend to in-person services, medical equipment, or pharmaceuticals dispensed in connection with a telehealth visit (unless those items independently qualify under the applicable guidance).
Bronze and Catastrophic Plans Now HSA-Compatible
Effective for months beginning after December 31, 2025, Exchange-based bronze and catastrophic plans are treated as HDHPs under Section 223(c)(2)(H), regardless of whether they meet the standard HDHP deductible and out-of-pocket requirements.
Before OBBBA, most bronze plans failed to qualify because their out-of-pocket maximums exceeded HDHP statutory limits or because they covered certain services pre-deductible. Catastrophic plans had a structural problem too: they were required to cover three primary care visits before the minimum deductible and carried OOP maximums that exceeded the HDHP thresholds. Both plan types are now HSA-compatible under the revised definition.
A bronze or catastrophic plan purchased off-Exchange qualifies if the same plan is also offered through an Exchange.
Direct Primary Care Service Arrangements (DPCSAs)
OBBBA amended Sections 223(c)(1) and 223(d)(2)(C) to address DPCSAs, arrangements where individuals pay a fixed periodic fee to a primary care provider for a defined set of primary care services. Two changes took effect for months beginning after December 31, 2025:
- DPCSAs no longer constitute disqualifying coverage. Individuals enrolled in both a qualifying HDHP and a DPCSA can still contribute to an HSA.
- HSA funds can pay DPCSA fees tax-free. Previously those fees carried potential treatment as insurance premiums, which are generally not a qualified medical expense.
To qualify, a DPCSA must provide only primary care services from primary care practitioners, charge a fixed periodic fee with no separate billing for covered services. The 2026 fee cap is $150 per month for individuals and $300 per month for family coverage (adjusted for inflation annually after 2026).
One key distinction on employer-paid fees: if an employer pays DPCSA fees, including through salary reduction in a cafeteria plan, those payments are excludable under Section 106 and cannot be treated as the employee’s qualified medical expenses for HSA purposes. Notice 2026-5 also clarifies that DPCSA services do not include procedures requiring general anesthesia, prescription drugs other than vaccines, or laboratory services not typically administered in ambulatory primary care settings.
HSAs as Long-Term Savings Vehicles
Beyond covering near-term healthcare costs, HSAs work well as supplemental retirement savings accounts. Balances grow tax-free indefinitely, and account holders who fund current medical expenses out-of-pocket can let HSA balances compound over time for use later, when healthcare costs typically run higher.
The expanded eligibility under OBBBA, particularly for bronze-plan enrollees and DPCSA participants, broadens the population that can access these tax advantages for the first time.
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