topic HSA Investment Account in Deductions & credits

HSA Investment Account

rsp12 — Mon, 09 Mar 2026 05:04:14 GMT

I invested $1350 over the $7300 limit into my HSA account. The $1350 was cash from my bank (not taken from payroll) and I am not going to deduct this, is there a penalty for doing so? So my total HSA investment was $8650, but only $7300 was deducted from payroll, and the other $1350 was taken out of my bank account. I am hoping there isn't a penalty for doing this. I only did this because I wanted to take advantage of the investment account that my plan offers.

Re: HSA Investment Account

MinhT1 — Thu, 24 Feb 2022 16:27:51 GMT

You cannot leave the excess contribution in your HSA. You have to withdraw the excess by April 18, 2022 (October 15 if you filed an extension) to avoid a tax penalty. The penalty will continue for every year the excess remains in the HSA account.

Please read this TurboTax Help topic for more information.

Re: HSA Investment Account

Mike9241 — Thu, 24 Feb 2022 18:17:00 GMT

$7300 is for the 2022 tax year. $7200 was the max for 2021

two options

1) if we're talking 2022 contribution, leave the excess in and pay a 6% penalty. then for 2023 reduce your contribution by the 2022 excess. Warning many taxpayers mess this up and over contribute resulting in more penalties.

2) on or before 4/15/2023 withdraw the excess and any earnings thereon. contact the trustee to do this because they need to compute the income. the income is taxable. for 2022

Re: HSA Investment Account

rsp12 — Thu, 24 Feb 2022 18:42:26 GMT

I max out my 2022 limit through payroll deductions. Last week I got excited about being able to invest in my BofA HSA investment account, so I added $1350 in cash to the mutual fund investment option in the HSA. I then realized this morning that I may have screwed up as I remembered the $7300 limit that I will hit through payroll deductions. It sounds as if I pull the the $1350 and any earnings out before April 2023, I should be fine other than needing to report any earnings as income? (Although I doubt any earnings will be much more than a few dollars this year). Basically, I just don't want to get hit with any type of penalty for going over $7300...although the $1350 that I will be going over isn't included as non-taxable deductions from payroll as it was cash outside of payroll deductions. Thanks for the help everyone...this is a tricky one that I couldn't find the answer to anywhere!