Contributions to an HSA (Health Savings Account)
Maximum Contributions
For 2009, the maximum you may contribute to a Health Savings Account (HSA) is $3,000 for single coverage or $5,950 for family coverage. Minimum HDHP deductibles are $1,150 for individuals and $2,300 for families.
For 2010, the maximum you may contribute to a Health Savings Account (HSA) is $3,050 for single coverage or $6,150 for family coverage. Minimum HDHP deductibles are $1,200 for individuals and $2,400 for families.
Minimum Contributions
After you establish your HSA, you have no legal obligation, per HSA regulations, to make additional contributions, even if you continue coverage under a High-Deductible Health Plan (HDHP).
Catch-Up Contributions
Because a new savings program tends to favor younger people with more time to save, a "catch up" provision was included with HSA regulations. HSA holders age 55 and older may make additional annual contributions of $1,000.
Employer Contributions
An employer may contribute to an employee's Health Savings Account (HSA), but the employer must make available comparable contributions on behalf of all "comparable participating employees." Contributions are considered comparable if they are the same amount or same percentage of the High-Deductible Health Plan (HDHP) deductible.
Partial Year Contributions
New legislation states that if you establish an HSA for a partial year, your maximum contribution remains at $3,050 for single coverage or $6,150 for family coverage as long as you maintain your HDHP insurance coverage for all of the following year (January 1 through December 31st).
Contribution Deadlines
HSA contributions must be made for a specific year on or before the due date (without extensions) for filing tax returns for that year. So contributions must be made on or before April 15th or the date you file your taxes, whichever comes first.
Higher HDHP Deductibles
You can purchase a High-Deductible Health Plan (HDHP) with a deductible beyond the HSA contribution limit, but the contribution must not exceed the cap. For example, a single person can purchase a $5000 deductible HDHP. However, that person's maximum HSA contribution would still be limited to that year's cap for single coverage.
HSA Contributions Must Be Cash
Health Savings Account (HSA) contributions must be in cash. For example, contributions cannot be made in stock or other property.
Rollovers Are Permitted
Rollover contributions from other HSAs are permitted. Rollovers are not subject to the annual contribution limits and rollover contributions need not be in cash. Rollovers from an IRA, a health reimbursement arrangement (HRA), or from a health flexible spending arrangement (FSA) are now permitted based on new legislation.
Excess HSA Contributions
Contributions by an individual are not deductible to the extent they exceed the maximum limits. Excess contributions by an employer generate taxable income to the employee. In addition, a 6% excise tax is imposed on the excess funds.
The excise tax and any net income attributable to excess contributions are avoided if the excess contributions are paid to the HSA owner prior to federal income tax deadline for the year at issue.
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