HSA/HDHP Self or Family

Forum|Forum|6 years ago
February 7, 2020
1 reply
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I have an HSA account in my name and pay expenses for both myself and my husband. We both had health insurance through the Marketplace for 2019. The Marketplace account indicates I am the recipient (Box 4) and my husband is listed as "Recipient's spouse's name" (Box 7 Form 1095-A).

In receipt of 3 1095-A's - one for husband (covered by a HDHP from January - July, 2019) - he turned 65 in August 2019 and is now on Medicare. I received one 1095-A covering January - August (enrolled in a NON-HDHP). Third 1095-A for me covers September - December (enrolled in a HDHP)

We want to open an HSA for my husband for the months he is eligible (Jan-July) and I also want to add to mine.

When the question of "Let's Maximize your Contribution Limit" I need to choose each month of "self, family, or none" for myself and him. I am confused - since we had different plans - does that mean the months I did NOT have an HDHP - is that self?

FYI - as of December 1, 2018 we were both enrolled in an HDHP for the entire year of 2018

Thanks for any help!

Best answer by BillM223

Because you had Self-only coverage on December 1, 2019, then your annual HSA contribution limit for 2019 is $3,500, thanks to the last-month rule. That's $4,500 if you are 55 or older.

The last-month rule lets you use the full annual limit if you were covered in the last month of the year.

The catch is that you have to stay under HDHP coverage throughout the testing period, which is essentially all of 2020. If you don't, then you will be penalized.

If you think you are likely to go off of HDHP coverage (or get conflicting coverage like Medicare) during 2020, then you should limit your actual 2019 contributions to 1/3rd of the normal annual limit (i.e. $1,500 for $4,500, or $1.167 for $3,500). Then, even if you have to admit to a "lapse" in HDHP coverage in 2020, it will be OK because when you enter that you were covered for 4 months, TurboTax will determine that your contributions were less than or equal to the prorated limit.

Your husband's limit will be $2,626 (assuming that he had only HDHP insurance on July 1 and no conflicting coverage).

***NOTE*** If you make contributions now for 2019, you MUST make sure that you tell the HSA custodian that the contributions are for 2019. Otherwise they will use the default year of 2020, and that will really foul up the paperwork (and what gets reported to the IRS).

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BillM223

To answer your question - No, you do not answer "Self" when you did not have HDHP coverage, you answer None.

Family and Self refer to the type of HDHP policy that you had. A Self policy is just you, and a Family policy is you and any other person, even one not eligible to contribute to an HSA.

First question: what type of HDHP policy did your husband have from January to July. It was an HDHP policy, but did it cover anyone besides himself?

Second question: What type of HDHP policy did you have for September through December, Family or Self?

Third, yes, your husband can retroactively create an HSA for 2019 and fund it so long as you do it before April 15th(see footnote***). However, the amount he can contribute depends on your answers to my questions.

Fourth, how much you can add to your HSA depends on (1) your answers above, and (2) how much you (and any one else, like spouses or employers) have already contributed to your HSA.

I look forward to your replies.

***As of this edit, the IRS has announced that the filing date has been moved to July 15th, but has not updated the myriad of rules to clarify that this includes any regulations that depend on the due date of the return. So while the IRS will probably not mind you contributing to your HSA until July 15th, there is no guarantee that your HSA custodian - lacking written instructions from the IRS - will accept such a contribution after April 15th. In these uncertain times, it would seem prudent to make such a contribution by April 15th in any case.

[Edited 3/24/2020 2:13 pm CDT - updated for July 15th]

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BenjamineAuthor

Employee

Thanks for the quick reply, Bill!

Husband had HDHP that only covered him (Jan-July)

My HDHP covered only myself (Sept-Dec)

No HSA contributions made yet. Wasn't aware I couldn't use "my" HSA to pay his medicare premiums so want to open for him to be able to do so and get the tax break. No additional contribution to my HSA yet - the last month rule and this "self" threw me for a loop so will do after calculations are made!

2019 was the first year we did not have a "family policy" so I've never dealt with this before! So much appreciate your help!

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