How are contributions made to an HSA?
HSA contributions must be made in cash or its equivalent, including check or credit card. Rollovers or transfers of assets from an MSA or an FSA (through 2011) will also be accepted. Also, effective January 1, 2007, new rules allow for a one-time contribution to an HSA of amounts distributed from an Individual Retirement Account (IRA). The contribution must be made in a direct trustee-to-trustee transfer. This IRA transfer will not be included in income or subject to the early withdrawal additional tax. The transfer is limited to the maximum HSA contribution for the year, and the amount contributed is not allowed as a deduction. Generally, only one transfer may be made during the lifetime of an individual. If an individual electing the one time transfer does not remain an eligible individual for the 12 months following the month of the contribution, the transferred amount is included in income and subject to a 10% additional tax.
A. Contributions may be paid in a lump sum, pretax through payroll deduction with MoneyPlu$ or in any combination of payments during the year as long as the total does not exceed the maximum annual amount. Note: You may change the amount you contribute to your MoneyPlu$ HSA through payroll deduction monthly. To make this change, contact your benefits administrator. Participants may make a one-time, irrevocable transfer from an IRA to an HSA, as long as the amount transferred does not exceed the maximum annual amount. This transfer may be made without penalty. Note: Any transfer from an IRA to an HSA will reduce the maximum amount that may be contributed to an HSA for that year.
