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IRS Releases 2024 Adjustments and Benefit Limits for ACA Affordability, HDHP Deductibles, FSA Contributions, and More
IRS Releases 2024 Adjustments and Benefit Limits for ACA Affordability, HDHP Deductibles, FSA Contributions, and More
With 2024 approaching fast, the IRS has begun to release some of next year’s indexing adjustment and benefit limits for health and welfare plans.
One of the most-watched IRS adjustments each year is the required contribution percentage used to determine whether employer-sponsored health coverage is considered affordable under the Affordable Care Act (ACA). The IRS once again decreased the affordability baseline from 9.12% in 2023 to 8.39% in 2024. As a reminder, Applicable Large Employers (ALEs) subject to the ACA employer mandate have to offer affordable, minimum value coverage to their ACA full-time employees. For 2024, this means that a job-based health plan’s employee-only coverage needs to cost 8.39% or less of the employee’s household income to be considered affordable. The cost is the amount the employee pays for the insurance, not the plan’s total premium. The federal poverty line (FPL) maximum premium contribution for employee-only coverage for 2024 is $101.93, which is a decrease from the 2023 FPL plan year limit of $103.28.
All Applicable Large Employers (ALEs) subject to the ACA employer mandate are required to offer affordable, minimum value coverage to their ACA full-time employees.
As a reminder, earlier this year the IRS released some of next year’s indexing adjustments and benefit limits for health and welfare plans, including 2024 HSA contribution limits, minimum annual HDHP deductibles, and plan out-of-pocket maximums for HSA eligibility. The table below shows the limits that have been released. Check back often as this table will be updated as new 2024 limits are provided.
| 2023 | 2024 | |
|---|---|---|
| HSA Contribution Limit – Single | $3,850 | $4,150 |
| HSA Contribution Limit – Family | $7,750 | $8,300 |
| HSA Contribution Limit – 55+ Catch-Up Contribution | $1,000 | $1,000 |
| Minimum HDHP Deductible – Single | $1,500 | $1,600 |
| Minimum HDHP Deductible – Family | $3,000 | $3,200 |
| Plan Out-of-Pocket Maximum for HSA Eligibility – Single | $7,500 | $8,050 |
| Plan Out-of-Pocket Maximum for HSA Eligibility – Family | $15,000 | $16,100 |
| Maximum amount made newly available for excepted benefit HRA | $1,950 | $2,100 |
| FSA Contribution Limit | $3,050 | $3,200 |
| FSA Carryover | $610 | $640 |
| Qualified Transportation Benefit (Monthly) | $300 | $315 |
The information the IRS has provided thus far is helpful, but there is still a lot of information coming as employers plan for 2024. As the year winds down, keep in touch with your OneDigital consultant to learn the 2024 limits and how they can impact the benefit plans you offer and participate in.
For additional information on the 2024 plan year, check out this post on the IRS' 2024 Retirement Plan Contribution Limits.
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