Question: An employee who began the year in employee-only HDHP coverage was recently married and enrolled her new spouse mid-year.  What is the HSA contribution limit for HSA-eligible individuals enrolled part of the year in employee-only HDHP coverage, and part of the year in family HDHP coverage?   

Compliance Team Response:

The HSA contribution limits are calculated on a monthly basis.  This means the employee is able to contribute 1/12 of the employee-only limit for the months of the year in employee-only HDHP coverage, and 1/12 of the family limit for the months of the year in family HDHP coverage.

The employee’s overall annual contribution limit is the sum of those two prorated employee-only and family contribution numbers.

You look to the coverage in effect as of the first day of each calendar month to determine whether the employee has employee-only or family HDHP coverage for that month

The IRS has a chart to handle this calculation on page four of the Form 8889 Instructions.  You just need to adjust the numbers for the current-year contribution limits.

• 2018 HSA Contribution Limits

• 2019 HSA Contribution Limits

For more details on how the HSA contribution limit applies in other situations, see slides 11-18 of our Newfront Office Hours webinar Go All the Way With HSA: Everything HDHP/HSA You Need to Know.

Regulations:

IRS Form 8889 Instructions:

https://www.irs.gov/pub/irs-pdf/i8889.pdf

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IRC §223(b)(2):

(2) Monthly limitation.

The monthly limitation for any month is 1/12 of—

(A)  in the case of an eligible individual who has self-only coverage under a high deductible health plan as of the first day of such month, $2,250.

(B)  in the case of an eligible individual who has family coverage under a high deductible health plan as of the first day of such month, $4,500.