HSA Question

[cmlynch100]

I had lunch with a broker friend and HSA's came up. Specific situation was an under 65 employee providing employer based coverage for themselves and their 65+ spouse. Broker friend stated that the 65+ covered dependent could not enroll in Part A if the employee wanted to continue to contribute the max family amount to the HSA. This is not how I've always understood and doesn't match what the documentation states either. What is your understanding of this? I've always thought as long as the HSA was in the name of the under 65 employee, they could contribute the max family amount if the covered dependent was 65+ and enrolled in A.

 

[axeman462]

I had lunch with a broker friend and HSA's came up. Specific situation was an under 65 employee providing employer based coverage for themselves and their 65+ spouse. Broker friend stated that the 65+ covered dependent could not enroll in Part A if the employee wanted to continue to contribute the max family amount to the HSA. This is not how I've always understood and doesn't match what the documentation states either. What is your understanding of this? I've always thought as long as the HSA was in the name of the under 65 employee, they could contribute the max family amount if the covered dependent was 65+ and enrolled in A.

Once enrolled in Medicare you are no longer eligible to contribute to an HSA.

The Medicare enrolled member cannot contribute, but the spouse still can. However, the amount allowed will be for one person (I believe $4,300 for 2025) not the family amount.

Now, the question I am not sure of is, can the Medicare enrolled member max out the HSA before enrolling in Medicare for the year, or is the allowed amount pro-rated for the year? Might be a good question for a CPA

 

[kstein]

HSA funding and eligibility are based on the owner/employee/custodian of the account so yes the t65 spouse can take part A only and the employee can still fully fund the HSA.

If they are scared about it just have them delay taking part a absent them drawing social security.

 

[Chazm]

Once enrolled in Medicare you are no longer eligible to contribute to an HSA.

The Medicare enrolled member cannot contribute, but the spouse still can. However, the amount allowed will be for one person (I believe $4,300 for 2025) not the family amount.

Now, the question I am not sure of is, can the Medicare enrolled member max out the HSA before enrolling in Medicare for the year, or is the allowed amount pro-rated for the year? Might be a good question for a CPA

You can contribute a prorated amount based on the number of months you were not enrolled into part A.

 

[axeman462]

You can contribute a prorated amount based on the number of months you were not enrolled into part A.

That's what my gut was telling, but I wasn't sure.
Thank you for the clarification

 

[LostDollar]

HSA funding and eligibility are based on the owner/employee/custodian of the account so yes the t65 spouse can take part A only and the employee can still fully fund the HSA.

If they are scared about it just have them delay taking part a absent them drawing social security.

If you mean fully fund with a family level of contribution, that is not allowed.

If the T65 spouse takes part A, as Chazm said, they can contribute prorated amount up to the month they take Part A. (Note: I'd have to check the proper IRS pub to be sure, but I believe the catchup amount must be prorated as well as the base contribution.

The under 65 spouse can contribute for the full year, to their account.

 

[LostDollar]

One other note. If the couple had two HSA accounts, one in each of their names, the under 65 spouse must be very careful to put their contributions into the account which is in their name.

And another note, the over 65 spouse can provide the cash for the under 65 spouse to use to make their contribution, the contribution just has to be in the name of the under 65 spouse and go into their account.

 

[LostDollar]

Once enrolled in Medicare you are no longer eligible to contribute to an HSA.

The Medicare enrolled member cannot contribute, but the spouse still can. However, the amount allowed will be for one person (I believe $4,300 for 2025) not the family amount.

Now, the question I am not sure of is, can the Medicare enrolled member max out the HSA before enrolling in Medicare for the year, or is the allowed amount pro-rated for the year? Might be a good question for a CPA

And don't forget the catchup amount. 2024 single contribution was 5150 with the catchup amount.

 

[LostDollar]

I had lunch with a broker friend and HSA's came up. Specific situation was an under 65 employee providing employer based coverage for themselves and their 65+ spouse. Broker friend stated that the 65+ covered dependent could not enroll in Part A if the employee wanted to continue to contribute the max family amount to the HSA. This is not how I've always understood and doesn't match what the documentation states either. What is your understanding of this? I've always thought as long as the HSA was in the name of the under 65 employee, they could contribute the max family amount if the covered dependent was 65+ and enrolled in A.

Also, if the over 65 spouse is going to defer taking Part A in order to continue contributing to their HSA, keep in mind that Soc Sec backdates the Part A start date 6 months.

I don't know if you can request a specific Part A start date like you can with Part B. And if you can, I don't know if you can count on getting it. There have been a number of thread posts where agents have talked about clients not getting the Part B start date the client requested when doing the "coming off employer coverage" paperwork.

(not an agent, but I am a Medicare Beneficiary with an under 65 HSA on the family tax return.)

 

[somarco]

If enrolling in Medicare A after age 65, note that Part A is backdated up to 6 months from the date of the application but not before the 65th birthday.

And there are no joint HSA's. Each spouse has their own account.