Author Topic: HSA Contributions for Year Turning Age 65  (Read 1205 times)

iluvzbeach

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HSA Contributions for Year Turning Age 65
« on: November 21, 2024, 12:26:35 PM »
I have a question for the tax/HSA experts on the boards.

We use ACA for health insurance as we are both retired with no earned income.  DH will be turning 65 in September 2025 and will be going on Medicare effective 9/01.  I won't be 65 for 10+ more years.

I've read information about not being able to contribute to an HSA for the 6 months prior to going on Medicare but I *think* that may only apply to people who are still working and have possibly delayed going on Medicare to 65 or beyond.  Please correct me if I'm mistaken.

If we use an HSA-eligible HDHP in 2025, can we contribute DH's pro-rata portion of HSA contributions + his catch-up for the months of January - August 2025, or are we limited to contributing his portion for only the months of January & February (using the six-month rule)?

I'm trying to determine how much we'll be able to contribute to our HSAs for 2025 and it will obviously depend on how many months we can contribute for him.  I've got both scenarios figured out in Excel, so I don't need help with the math, it's just the eligibility months that I need.

Thanks in advance for your help!

secondcor521

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Re: HSA Contributions for Year Turning Age 65
« Reply #1 on: November 21, 2024, 01:03:10 PM »
See https://www.irs.gov/publications/p969#en_US_2023_publink1000204063.

Google says that Medicare coverage can't be backdated to before the month in which one turns 65.

So I think it's the longer period (Jan to Aug).

And yes, his over-55 catchup is also pro-rated.


iluvzbeach

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Re: HSA Contributions for Year Turning Age 65
« Reply #2 on: November 21, 2024, 03:29:23 PM »
Thank you, as always, secondcor521. 

I've done a bit more research and, if I am understanding correctly, this "six-month rule" applies to people who are continuing to work after turning 65 because, apparently, Medicare Part A (hospitalization) is automatically retroactive six months.  Since DH does not work and will be applying for all Medicare to begin at age 65, then he won't be affected by this.

Could they possibly make it any more confusing?  All I want to do is continue to max out our HSA contributions to the extent possible but don't want to over contribute.

MDM

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Re: HSA Contributions for Year Turning Age 65
« Reply #3 on: November 21, 2024, 09:21:12 PM »
All I want to do is continue to max out our HSA contributions to the extent possible....
8/12 of the family maximum and 55+ catch-up for him.

Assuming you are also covered under a family HDHP for those 8 months, and go to a single HDHP for the rest of the year, you get to contribute 8/12 of the family maximum, 4/12 of the single maximum, and either $0 or $1,000 catch-up depending on the definition of "+" in "won't be 65 for 10+ years".

See "Enrolled in Medicare" on p. 7 of https://www.irs.gov/pub/irs-pdf/p969.pdf if you have any remaining doubts about 2cor521's correct advice.

iluvzbeach

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Re: HSA Contributions for Year Turning Age 65
« Reply #4 on: November 22, 2024, 09:50:44 AM »
Thank you, MDM. This is exactly how I’ve calculated it. I will turn 55 in 2025, so will be eligible for catch-up as well. According to my calculations, we’ll be able to contribute a total of $8800 in 2025 with ~$666 of that being his catch-up portion and going to his HSA. We’ll put the rest in mine.

Thanks again for weighing in; I always appreciate it when you & secondcor provide input.