Hi, I'm trying to understand what seems to be contradictory instructions about contributions to an HSA before going on Medicare. The IRS (Pub. 969) gives this example:
"You turned age 65 in July 2020 and enrolled in Medicare. You had an HDHP with self-only coverage and are eligible for an additional contribution of $1,000. Your contribution limit is $2,275 ($4,550 × 6 ÷ 12)."
Sensible enough. And it's literally my situation: I'll be enrolled in Medicare in July 2022. In fact, I'm not eligible to even apply until April. However, this is what someone in Medicare.gov wrote in a chat (pardon the long quote):
"If you had a health savings account, also known as an HSA, before you enrolled in Medicare, you can keep it. After you enroll in Medicare, neither you nor your employer can contribute to your HSA, but you can continue using the money in your HSA to pay for medical expenses. [...] To avoid a tax penalty, all contributions to your HSA should stop at least 6 months before you enroll in Medicare."
That last sentence is the kicker. Most of the discussions I've seen concern people who apply for Medicare late (without clarification whether they contributed before or after official enrollment). Some discussions even say you must stop contributing six months before going on Medicare. But if I contribute the maximum to my HSA before I become eligible for Medicare, and for that matter before I can even apply, why would I be penalized? The IRS publication says nothing about this. Or is the Medicare.gov statement just overly cautious? (I tried asking the IRS but apparently right now they don't have anyone at all who's covering these questions)
The issue is concerning because I made a contribution in January and planned to bring myself up to the max (this year, $2325) this month -- and I've already spent a good portion of my January contribution, so withdrawing it could be a serious mess.
