What if total contributions exceed the limits?
If total contributions exceed the allowable contribution limit for the year, you may be subject to an excess contribution tax. A 6% tax applies to each year until the excess is corrected. You can avoid the 6% penalty if you remove the excess prior to your tax filing due date. It is your responsibility to remove excess contributions and any earnings before filing your federal income taxes (including extensions).
Related Questions
- Your disclaimer states that "if the total contributions exceed the funding needs for a certain project, we’ll ensure the funds are reallocated to other areas where children are in need." What does this mean?
- What if the total HSA contributions in a year exceed the limit?
- What if total contributions exceed the limits?
