Excess HSA Contribution 2024

[EHutchins]

My husband and I got married Feb 2024. 

We both had separate Self-Only HSA plans during 2024. 

I contributed $423 and he contributed $507 over the self-only annual 2024 limit. 

Both of our accounts have had the money invested. I only carry $50 in my HSA and he carries around $1000. The rest is invested in stocks. 

We’re looking to remove the excess prior to filing our taxes this year. We’re a bit confused on how much to remove given our situation, if we qualify for the family limit, and if we do would he be able to withdraw for the both of us. 

[MindyB]

Congratulations on your wedding.  You will need to remove the excess of the contributions over the family limit, which is $8,300 if you're both under 55 at the end of 2024.  This amount is exactly double the individual contribution limit, so your employers shouldn't have allowed this overcontribution. Are you sure you both overcontributed to your individual HSAs? They have a limit of $4,150 if you are under 55.

Since you had separate HSAs, you should withdraw the excess from each account with the overage.

Your HSA custodian will be able to provide you with a form to remove the excess contribution, and you should move the amount needed for the withdrawal out of investments into cash to ensure no delay in the withdrawal.

@EHutchins [Edited 03/05/25 | 3:15 pm PST]

[EHutchins]

Thank you!! 

I believe that we were able to do excess contributions since our employer does contribute as well per paycheck. We are both over the $4150. 

Thank you for the support! I appreciate the quick response.

[dmertz]

It appears that @MindyB  overlooked the fact that you have separate self-only coverage, not family coverage.  The fact that you do not have family coverage means that each of you is separately subject to the self-only contribution limit, not the contribution limit for family coverage, and must separately obtain returns of contributions from each of your HSAs.

The method described in CFR 1.408-11 is used to calculate the net income attributable to the excess contribution being returned.

https://www.law.cornell.edu/cfr/text/26/1.408-11

You'll likely have to sell shares to have the cash necessary to make the corrective distribution.

[MindyB]

@EHutchins - I edited my answer, as @dmertz points out I did overlook the fact you did not combine accounts, so please remove the excess separately. 

Although your employer also contributes money, they still should not allow you to overcontribute- can you confirm that your W-2 shows more than $4,150 in Box 12 Code W for both of you?

[EHutchins]

@MindyB  - my W-2 is showing $3573 but my HSA is showing over $4150 and sent me my Excess Contribution Removal form. 

[EHutchins]

Looking at my HSA it shows that I contributed $3573 and my employer contributed $1000. 

[BillM223]

OK, let's look at your W-2. The amount in box 12 with a code of W is the SUM of what your employer contributed plus what you contributed by payroll deduction. So when you say that you contributed $3,573 was this the code W amount or was the code W amount $4,573?

Did you say that the code W amount was $3,573, but TurboTax told you that the excess contributions were over $4,150? That doesn't make sense.

Don't use the Excess Contributions Withdrawal form until TurboTax tells you what your excess is.

When I see you say that your excess was over $4,150, either I misunderstand you, or you did not go through the HSA interview to tell TurboTax what your HDHP coverage was.

Please go back through the HSA interview and go to the Summary - this should look like this:

Tell us the numbers and we will be able to make sense of this for you.