HSA Frequently Asked Questions

What is a Health Savings Account?

A Health Savings account is a tax-exempt trust or custodial account established exclusively for the purpose of paying or reimbursing qualified medical expenses of you, your spouse, and your dependents.

Am I Eligible for an HSA?

  • You are eligible for a regular HSA contribution if, with respect to any month, you:
  • Are covered under a high-deductible (HDHP) on the first day of such month;
  • Are not also covered by any other health plan that is not an HDHP (with certain exceptions for plans providing preventive care and limited types of permitted insurance and permitted coverage);
  • Are not enrolled in Medicare; and
  • Cannot be claimed as a dependent on another individual’s tax return.

What is an HDHP?

An HDHP is a high-deductible health plan with an annual deductible no less than the amounts shown in the chart below.

HDHP Annual Deductible
Tax Year Self-Only Coverage Family Coverage
2011 $1,200 $2,400
2012 $1,200 $2,400
2013 and later $1,200* $2,400*

*Subject to annual cost-of-living adjustments.

How Much Can I Contribute to My HSA?

The maximum annual contribution amount is the standard limit as shown in the chart that follows.
Additional, “catchup” contributions are available for eligible individuals who are age 55 or older by the end of their taxable year and for any months individuals are not enrolled in Medicare.

Contribution Limits

Tax Year
Standard Limit Catch-up
Contribution Limit
Self Only Family
2011 $3,000 $6,150 $1,000
2012 $3,100 $6,250 $1,000
2013 and later $3,100 $6,250 $1,000

 

May I claim a Federal Tax Deduction for My HSA Contribution?

Contributions to an HSA are tax deductible, the earnings grow tax deferred, and distributions to pay or reimburse qualified medical expenses are tax free. 

You may deduct contributions made by anyone other than your employer as long as they do not exceed the maximum annual contribution amount. Employer contributions are not wages for federal income tax purposes.
Rollovers and transfers from HSAs, IRAs, Archer medical savings accounts, health reimbursement arrangements, and health flexible spending accounts are not tax deductible.

When is the Contribution Deadline for Funding an HSA?

The deadline for regular and catch-up HSA contributions is your federal income tax return due date, excluding extensions, for that taxable year. The due date for most taxpayers is April 15.

What Happens to My HSA in the event of My Death?

Spouse Beneficiary

If your spouse is the beneficiary of your HSA, the HSA becomes his/her HSA.

Nonspouse Beneficiary

If your beneficiary is not your spouse, the HSA ceases to be an HSA as of the date of your death.  If your beneficiary is your estate, the fair market value of the HSA as of the date of your death is included as income on your final income tax return. For other beneficiaries, the fair market value of your HSA is included as income for the recipient in the tax year of your death.

This is intended to provide general information concerning the federal tax laws governing HSAs. It is not intended to provide legal advice or to be a detailed explanation of the rules or how such rules may apply to your individual circumstances or under your state tax laws.

For specific information, consult your tax or legal professional. IRS Publication 969, Health Savings Acounts and Other Tax-Favored Health Plans, the instructions to IRS Form 8889, and the IRS’s web site, www.irs.gov may also provide helpful information.

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