How is the maximum annual contribution to an HSA determined?
Previously, the HSA contribution was pro rated based on the number of months during the year that an individual was eligible for the HSA. Effective January 1, 2007, new provisions provide an exception that will allow individuals who become covered under an HSA-eligible plan in a month other than January to make the maximum HSA contribution for the year based on their coverage in the last month of the year. This eliminates a common barrier to switching HSA-eligible coverage. If an individual does not stay in the HSA-eligible plan 12 months following the last month of the year of the first year of eligibility, the amount that could not have been contributed except for this provision will be included in income and subject to a 10% additional tax. For individuals or couples over age 55 or over, catch-up contributions may also be made. What is the deadline for annual HSA contributions? Contributions for the taxable year can be made in one or more payments, at any time prior to the time for
Related Questions
- If administration and account maintenance fees are withdrawn from the HSA, does the withdrawn amount increase the maximum annual HSA contribution limit?
- If I enroll in the HDHP after January 1 but by December 1, can I still contribute the maximum annual HSA contribution for that year?
- Can I still make my maximum annual HSA contribution if I started my High Deductible Health Plan during the year?
