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Stay Informed - The New Limits for 2021 Benefit Plans

2020 is finally at its end with the new year almost upon us - and benefits plans have reached new limits (literally). The limits for various benefits have either increased or remained the same due to inflation. The IRS announces these changes ahead of time to give employers like yourself a heads-up and make sure your plans are consistent with these new limits. Knowing these changes will help you better mold your benefits offerings for your team without exceeding your budgets or compromising on quality.


401(k) LIMITS

  • Pre-tax contributions: $19,500 (no change from 2020)

  • Catch-up contributions: $6,500 (no change from 2020)


HEALTH SAVINGS ACCOUNTS (HSA) LIMITS

  • Pre-tax contributions:

  • Single coverage: $3,600 (up $50 from 2020)

  • Family coverage: $7,200 (up $100 from 2020)

  • Catch-up contributions: $1,000 (no change from 2020)


HIGH DEDUCTIBLE HEALTH PLAN (HDHP) LIMITS

  • HDHP minimum deductible

  • Single coverage: $1,400 (no change from 2020)

  • Family coverage: $2,800 (no change from 2020)

  • HDHP maximum out-of-pocket costs

  • Single coverage: $7,000 (up $100 from 2020)

  • Family coverage: $14,00 (up $200 from 2020)


FLEXIBLE SPENDING ACCOUNT (FSA) LIMITS

  • Contributions: $2,750 (no change from 2020)


For information on how these limits can affect your small business’ health benefits plan in 2021, contact the insurance experts at NY Small Business.


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