In order to make a tax-deductible or pre-tax contribution to your Health Savings Account (HSA), you must meet the eligibility guidelines published by the U.S. Treasury Department. View eligibility requirements.
The maximum amount that may be contributed to your HSA cannot exceed the maximum contribution limit published annually by the U.S. Treasury Department. These maximum contribution levels are based on whether you have single or family high-deductible health plan (HDHP) coverage. The same annual contribution limit applies regardless of whether the contributions are made by you, your employer, a family member, a friend or any combination. If you are married, view this table for more information about your contribution maximum.
Individuals who are age 55 or older may also make a catch-up contribution. Catch-up contributions cannot exceed the annual catch-up contribution limit published each year by the U.S. Treasury Department.
For any calendar year that you do not meet all the eligibility requirements on December 1, you may only contribute a maximum of the pro-rated amount, based on the months you were eligible in that year. If you meet the eligibility requirements on December 1 of any year, you may contribute the calendar year maximum for that year. However, if you contribute more than the pro-rated amount for the months you were eligible, the IRS requires that you continue to meet the eligibility rules during a testing period. That testing period is the entire following calendar for any effective date other than January 1. If you do not remain eligible to make contributions through December 31 of the following year, your contributions for months you were not eligible in the prior year should be included in your gross income on your individual income tax return and subject to income taxes and an additional 10 percent excise tax.
If both you and your spouse meet the eligibility rules, each of you could make contributions to your own HSA. The annual maximum contribution must be split between the two HSAs, based on an agreement between you and your spouse. Please note that in order to both be eligible for the catch-up contribution, you must both contribute to your own HSA. Please see the table for the maximum contribution limits for married couples.
Your total contribution for the year can be made in one or more payments at any time up to your tax-filing deadline, without extensions. (This is generally April 15) However, if you wish to have your contribution between January 1 and July 15 treated for the preceding taxable year, you must take one of these steps to notify UMB, so that UMB can report it correctly to the IRS:
Let your employer know that you would like your payroll deduction applied to the prior year.
Provide written notification to UMB requesting that a contribution be applied to the prior year.
In the absence of one of these three steps, all contributions from January 1 through July 15 will be treated as contributions for the current taxable year.
Contributions are only accepted in the form of cash. Cash Payments can be in the form of a check, online contribution or employer contribution. No other forms of payment (such as stocks or property) are accepted for HSA contributions.
UMB provides several convenient options for making one-time or recurring contributions to your HSA.
Payroll Deduction If you enrolled in your HSA as part of your employer’s benefit plan, you may have the option of signing up for payroll deductions. For most people, these contributions are deducted from your paycheck before federal, state and FICA (Medicare and Social Security taxes) are withheld. This contribution option provides you the greatest tax advantage, and you won’t have to wait until you file your income tax return to get the savings. Also, this is the only method that allows you to save on employment taxes, as you won’t pay FICA (5.65 percent in 2012) on your contributions. Unlike an FSA, you may start, stop or change your payroll deduction amount during the year, should your personal finances change. See your employer to find out how to sign up for payroll deductions or to change your current payroll deduction amount.
Online Contribution You can make tax-deductible, one-time or recurring contributions to your HSA by logging on to your account. The initial set up process will allow you to link your personal bank account with your HSA so that you can easily transfer funds whenever you want. During the first 3 ½ months of each year, you will also have the option to make prior-year contributions.
Contribution Form and Check Download the
here. Make sure to check the appropriate box if any of the following apply to your contribution:
Prior-Year Contribution. You may select to have your contribution deposited under the prior plan year if your contribution falls between Jan 1 and Apr 15, and you have not paid this year’s taxes.
Employer Contribution. If this is an employer contribution.
Re-deposit. If you need to add money back to your HSA that was mistakenly withdrawn, you must re-deposit funds by the end of the calendar year, or the mistaken withdrawal will be reported to the IRS for that year.
Rollover. If you received a check from another HSA or Medical Savings Account (MSA) custodian, you can roll the funds into your UMB HSA. This rollover contribution will not be counted against your annual contribution maximum, as long as you deposit the funds within 60 days of your receipt of the check from the prior custodian. Note: You may not rollover IRA funds using this form. An IRA funding distribution must be done as a direct trustee-to-trustee transfer.
IRA Funding Distribution You are generally allowed one tax-free trustee-to-trustee transfer of IRA funds into an HSA, in your lifetime. The amount of an IRA funding distribution that is transferred to your HSA is subject to your maximum annual contribution limits.
HSA Trustee-to-Trustee Transfer This allows you to direct a custodian to transfer your MSA or HSA to your UMB HSA. The IRS doesn’t count the transfer against your annual contribution limits. To transfer another HSA to UMB, download the Trustee Transfer Form.
Employer Contribution Your employer may also make a one-time or recurring contribution to your HSA. Employer contributions are not taxable income to you. And, you may even have the opportunity to receive higher contributions if you participate in wellness or other programs offered by your employer. Please see your employer to find out if contributions are available to you.
Other Contributions Your friends and family may also contribute to your HSA. You can deduct their contribution from your gross income on your personal income tax return, making their gift go a little farther.
For additional information and common questions on contributions, visit our FAQ
Funds in an HSA Deposit Account are held at UMB Bank, n.a., Member FDIC. High-Deductible Health Plans constitute insurance products, which are not offered by UMB Bank, n.a. and are not FDIC-insured.
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