For HSAs Only – High Deductible Insurance Plan Effective Date – what is this date used for?
Your eligibility to contribute to an HSA is determined by the effective date of your HDHP coverage. Your annual contribution depends on your HDHP coverage. If you are not covered on December 1, your contribution depends on the number of months of HDHP coverage you have during the year (technically, the months where you have HDHP coverage on the first day of the month). For 2007 and forward, if you are covered on December 1, you are treated as an eligible individual for the entire year. However – if you cease to be an eligible individual during 2008, the excess over the pro rated contribution is included in income and subject to a 10 percent additional tax. The amount you can contribute is not determined by the date you establish your account. However, medical expenses incurred before the date your HSA is established cannot be reimbursed from the account.
Related Questions
- My husbands insurance just changed to a HIGH DEDUCTIBLE HSA/HRA plan. How does this change from the traditional deductible that we had in the past?
- Can a policyholder continue to deposit into an MSA as long as the insurance plan is a qualified high deductible plan?
- For HSAs Only - High Deductible Insurance Plan Effective Date – what is this date used for?
