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December 2020: Employee Benefits Plan Limits for 2021

Business Insurance

 

Employee Benefits Plan Limits for 2021

Many employee benefits are subject to annual dollar limits that are periodically updated for inflation by the IRS.

The IRS typically announces the dollar limits that will apply for the next calendar year well in advance of the beginning of that year. This gives employers time to update their plan designs and make sure their plan administration will be consistent with the new limits. Although some of the limits will increase for 2021, most of the limits remain the same.

Increased Limits 
For plan years beginning on or after Jan. 1, 2021, the following limits have increased: 
  • Health savings account contributions: 
    • Single coverage—$3,600 (up $50)
    • Family coverage—$7,200 (up $100)
  • High deductible health plan (HDHP) out-of-pocket maximum limit: 
    • Single coverage—$7,000 (up $100)
      • Family coverage—$14,000 (up $200)
  • Tax exclusion for adoption assistance benefits—$14,440 (up $140)
 
Unchanged Limits 
Certain limits will not change for 2021, including the flexible spending account salary reduction contribution limit, HDHP minimum deductible, 401(k) contribution limit and transportation fringe benefits monthly limits.
 
 
 
 
Additional articles from the December 2020 edition of the Univest Employee Benefits Newsletter:
  1. Final Rule on Health Care Transparency Issued
  2. How to Conduct 1-on-1 Benefits Meetings
  3. Virtual Workplace Holiday Parties
 
 

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Insurance products are offered through Univest Insurance, Inc. and are obligations of the issuing insurance companies, are not obligations or deposits of or guaranteed by any bank and are not insured by the FDIC or any other agency of the United States. Insurance products are not a condition to any bank loan, product or service. Univest Insurance, Inc. is a licensed subsidiary of Univest Corporation of Pennsylvania.
 
 
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