The IRS sets guidelines for how much you can contribute to an HSA each year. Following are the limits for 2016 and 2017:
You have until the tax-filing deadline (generally April 15) of the following year to make allowable contributions. Catch-up contributions can be made any time during the year you turn 55. See below for more information.
Individual vs. family contribution limits
Your contribution limits are generally determined by the type of qualifying high-deductible health plan you have — individual or family coverage. The amount you or anyone else can contribute to your HSA depends on the type of high-deductible health plan (HDHP) you have, your age, the date you become an eligible individual, and the date you cease to be an eligible individual are also considered. If you and your spouse are covered by different health plans, consult a tax advisor regarding your personal situation. You can find out more by visiting www.IRS.gov and searching for IRS Publication 969.
If you contribute more than the allowable amount to your HSA by accident or because you ended coverage in a qualifying high-deductible health plan and/or no longer meet the other requirements defined by the IRS, you will have to count the extra amount as taxable income and the IRS may have you pay a 6% excise tax on the excess contributions. The excise tax applies to each tax year the excess contribution remains in the account.
If you do make excess contributions, you can prevent being penalized by completing an Excess Contribution and Deposit Correction Request Form to have excess funds returned to you. This and other account forms are available after you log in.
Catch-up contributions, 55+
If you are 55 or older, you can make “catch-up” contributions, meaning you can deposit an additional $1,000 per year. If your spouse is also 55 or older, he or she may establish a separate HSA and make a “catch-up” contribution to that account.
When you enroll in a qualifying high-deductible health plan and open an HSA before the first day of December, you can contribute the total allowable amount for that year. To take advantage of the tax savings, however, you must:
- Stay enrolled in a qualifying high-deductible health plan for the following 12 months.
- Not have other health care coverage that would make you ineligible to contribute to an HSA.
If you end your coverage under a high-deductible health plan, you should calculate the pro-rated allowable contribution based on the number of months you had qualifying coverage. If you're 55 or older, be sure to include any catch-up contributions you made to determine the pro-rated amount.
If your contributions exceed the allowable amount, you can fill out an Excess Contribution and Deposit Correction Request Form to have excess funds potentially returned to you, which may prevent potential IRS penalties from being incurred. This and other account forms are available after you log in. For more information, visit www.IRS.gov and search for IRS Publication 969.
HAVE MORE THAN ONE HSA?
You can contribute to all of them as long as you don't exceed your annual contribution limit.