topic HSA and Medicare in Retirement tax questions

HSA and Medicare

paulgk123 — Sat, 27 Mar 2021 22:52:28 GMT

Greatly appreciate some advice: I delayed Medicare enrollment so I could keep contributing to my HSA. I enrolled in Social Security and Medicare effective January 2021 -- the month I turned 66. I knew about the 6 month retroactive period for Medicare A, so I thought I could contribute to my HSA through June 2020. However, I started my application process in September, and found that because of this, my Medicare A was retroactive to March 2020. So, definitely any contribution from March to June is now ineligible. Then, to make it worse, I discovered the pro-rated allowed contributions based on months of eligibility. So, my question: if I understand the IRS correctly, I would only be allowed two months of eligibility so my limit for 2020 would be 2/12 of ($3550+$100) = $758?

Bonus question: if my 2020 contributions were from me and from my employer, do I need to submit two requests for adjustment -- me directly to the fund and me to my employer?

Re: HSA and Medicare

Opus 17 — Mon, 29 Mar 2021 19:53:45 GMT

You are correct that if you were only eligible for 2 months, your maximum contribution is $758. When you request a "return of excess contribution" all the money comes to you, and is added to your taxable income. It does not go back to the employer, even if the employer contributed part of the money.

Re: HSA and Medicare

paulgk123 — Tue, 30 Mar 2021 16:24:46 GMT

But does the Employer have to initiate, at my request, the withdrawal of the funds they contributed?

Re: HSA and Medicare

Opus 17 — Tue, 30 Mar 2021 16:28:21 GMT

@paulgk123 wrote:

But does the Employer have to initiate, at my request, the withdrawal of the funds they contributed?

No, once the funds are deposited, they are all your money. The excess comes back to you and is added to your taxable income.