A may have access to contribution is money you put into your Health Savings Account that the IRS allows you to deduct from your taxable income
The money you contribute to an HSA reduces your taxable income for that year, which is the main tax advantage of having one. But not every deposit into an HSA account counts as a may have access to contribution. The IRS has specific rules about who can contribute, how much, and when the contribution window closes each year.
The most common may have access to contributions come from your paycheck through your employer's payroll deduction, or from you directly if you are self-employed or have no employer plan. Contributions from your employer also count as may have access to contributions, and they do not count toward your annual limit if they come through a cafeteria plan (a pre-tax benefit program). Contributions made after the tax year ends do not count unless you make them by the tax filing deadline for that year, usually April 15.
Key Takeaways
- You can only make may have access to contributions if you are enrolled in a high-deductible health plan (HDHP) on the first day of the month in which you contribute.
- The annual contribution limit for 2024 is $4,150 for individual coverage and $8,300 for family coverage, though these amounts change each year.
- Contributions made through payroll deduction or directly to the HSA trustee count as may have access to; transfers from other accounts or reimbursements for past expenses do not.
- You can contribute until the tax filing deadline of the following year (usually April 15) and still have it count for the prior tax year.
- If you lose HDHP coverage partway through the year, contributions made after that date do not count as may have access to.
Who can make a may have access to contribution
You must be enrolled in an HDHP on the first day of the month you contribute. This is the single most important rule. If you switch to a different health plan mid-month, contributions made after that switch do not count as may have access to, even if you were covered by an HDHP for most of the month.
You also cannot be claimed as a dependent on someone else's tax return, and you cannot be enrolled in Medicare. If you turn 65 and enroll in Medicare, you can no longer make new may have access to contributions, though you can still withdraw money from your HSA for may have access to medical expenses.
If you have other health coverage besides your HDHP — such as a spouse's plan, a parent's plan, or coverage through Medicaid or TRICARE — you may still contribute, but the rules are stricter. You cannot have any coverage that is not an HDHP, with a few exceptions like dental-only or vision-only plans, workers' compensation, or coverage for a specific disease.
How much you can contribute each year
The IRS sets annual limits that change each year. For 2024, the limit is $4,150 if you have individual HDHP coverage, or $8,300 if you have family coverage. These limits include contributions from your employer, contributions you make yourself, and catch-up contributions if you are 55 or older.
If you are 55 or older, you can contribute an extra $1,000 per year on top of the standard limit. This catch-up contribution is available only to you, not to your spouse, even if your spouse is also 55 or older and covered by the same family plan.
The limits apply to the calendar year, not to the plan year. If your employer's plan year runs from July to June, you still count contributions toward the calendar-year limit. If you contribute more than the limit in a single year, you may owe taxes and penalties on the excess amount.
Types of contributions that count as may have access to
Contributions through payroll deduction are the most straightforward. Your employer withholds money from your paycheck before taxes are calculated, and that money goes directly to your HSA trustee. This counts as a may have access to contribution.
Direct contributions you make yourself also count, as long as you send the money to the HSA trustee (the bank or financial institution that holds your account). You can write a check, set up an electronic transfer, or use a debit card linked to the account. The contribution must be made by the tax filing deadline of the following year to count for the prior tax year.
Employer contributions count as may have access to contributions even if they come through a cafeteria plan. Some employers allow you to contribute pre-tax dollars to your HSA through a Section 125 cafeteria plan, similar to how you might contribute to a flexible spending account (FSA). These contributions do not count toward your annual HSA limit.
Rollovers from another HSA also count as may have access to contributions, but only if you move the money within 60 days and do not exceed the annual limit for that year. Transfers between HSA trustees (moving your account from one bank to another) do not count as new contributions and do not affect your limit.
Types of contributions that do not count as may have access to
Reimbursements for medical expenses you paid out of pocket do not count as may have access to contributions. If you paid $500 for a doctor visit with your own money and then deposited $500 into your HSA to reimburse yourself, that deposit is not a may have access to contribution. It is a withdrawal and redeposit of your own money.
Transfers from other savings accounts or retirement accounts do not count as may have access to contributions unless they are direct rollovers from another HSA. If you move money from a savings account into your HSA, that is a personal deposit, not a may have access to contribution.
Contributions made after you lose HDHP coverage do not count as may have access to, even if you make them before the tax filing deadline. The rule is strict: you must be enrolled in an HDHP on the first day of the month you contribute. If you switch to a PPO plan on March 15, any contributions made in March or later do not count.
The contribution deadline and tax year rules
The deadline to make a may have access to contribution for a given tax year is the tax filing deadline of the following year, usually April 15. If April 15 falls on a weekend or holiday, the deadline moves to the next business day. This means you can contribute for 2024 until April 15, 2025, and still have it count toward your 2024 limit.
Your HSA trustee may have an earlier deadline. Some banks require contributions to be received by December 31 of the tax year to count for that year. Check with your trustee about their specific deadline, because the IRS deadline does not override a trustee's internal policy.
If you file your taxes early and claim a contribution that you have not yet made, you can still make that contribution by the tax filing deadline and amend your return if needed. However, it is safer to make the contribution first and then file your return.
What happens if you contribute too much
If your total contributions (from you, your employer, and any rollovers) exceed the annual limit, the excess amount is subject to income tax and a 6 percent excise tax. The excise tax applies each year the excess remains in the account, so it is important to catch and correct the error quickly.
If you discover an overage before you file your taxes, you can withdraw the excess amount plus any earnings on it, and the earnings will be taxed as income for that year. If you discover it after filing, you may need to file an amended return. Some HSA trustees offer correction programs to help you handle overages.
Frequently Asked Questions
Can my employer contribute to my HSA and have it count as a may have access to contribution?
Yes. Employer contributions count as may have access to contributions and reduce your annual limit dollar-for-dollar. If your employer contributes $2,000 and you contribute $2,000, you have used your full $4,150 limit for individual coverage in 2024. Employer contributions through a cafeteria plan do not count toward your limit.
What if I switch health plans in the middle of the year?
Contributions made while you are enrolled in an HDHP count as may have access to. Once you switch to a non-HDHP plan, contributions made after that date do not count, even if you switch back to an HDHP later in the year. The rule is based on your coverage status on the first day of each month you contribute.
Can I contribute to an HSA if I am self-employed?
Yes, as long as you are enrolled in an HDHP. You contribute directly to your HSA trustee, and you can deduct the contribution on your tax return. Self-employed contributions count toward the annual limit just like employee contributions do.
Do catch-up contributions count toward my regular annual limit?
No. If you are 55 or older, the $1,000 catch-up contribution is separate from the standard limit. For 2024, you could contribute $4,150 plus $1,000 for a total of $5,150 if you have individual coverage and are 55 or older.
Can I make a may have access to contribution after I turn 65 and enroll in Medicare?
No. Once you enroll in Medicare, you can no longer make new may have access to contributions to an HSA. You can still withdraw money from your existing HSA for may have access to medical expenses, and you can use it to pay Medicare premiums and long-term care insurance premiums.