Author Topic: HSA contribution from side hustle payroll?  (Read 678 times)

TJX

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HSA contribution from side hustle payroll?
« on: September 28, 2022, 09:07:22 AM »
I have a HDHP through my W-2 job, however the HSA they offer is not good. 
For the past few years I have been using post-tax funds to fund a Fidelity HSA.  The downside is that I am charged FICA on these funds.

I also have a separate single person s-corp for freelance work that pays me via payroll.

Can I use pre-tax payroll deductions from my s-corp to fund my HSA?

Combined, I try to keep both these total payrolls below the SS max to avoid over paying SS (which is very close, so a pre-tax deduction would be helpful), anything else to consider in this scenario?

seattlecyclone

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Re: HSA contribution from side hustle payroll?
« Reply #1 on: September 28, 2022, 10:18:31 AM »
A fine question. I don't have a direct answer for you.

Have you considered contributing to your W-2 job's HSA and rolling the money out periodically? Unlike with a 401(k) you can do this while you're still employed.

TJX

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Re: HSA contribution from side hustle payroll?
« Reply #2 on: September 28, 2022, 11:25:06 AM »
Thank you for the response.
Yes, I have considered joining my employer's HSA and periodically transferring to Fidelity, however I don't want to do that for the following reasons:

1. I am an officer in this small company of 15 relatively low paid employees.  I think me maxing my HSA would cause us to fail nondiscrimination testing (and thus making my contributions post-tax anyways).
2. There is a requirement to keep $2,000 in cash.
3. There is a $20 transfer fee
4. There is mention of a monthly maintenance fee but I can't find the amount (our PEO will cover this fee while I am employed here).