Additional HSA contributions in 2023 for 2022

[cleverlyengaged]

TurboTax asks if you contributed to an HSA in 2022. I wanted to confirm you can contribute in 2023 before tax day in April and have it count for 2022? 

When I add the maximum contribution of $7,300, TurboTax only reduces the tax owed by 1500. It goes from 19,500 to 18,000. What would be the reason for this small reduction? I was hoping to reduce adjusted gross income. 

[Critter-3]

Yes you can put into the HSA for 2022 until the filing deadline.

Look at the forms carefully ... a increase in the adjustment to the 1040 is NOT a $ for $ credit against federal taxes.   Also make sure you have entered in all the income and completed at least 2 of the 3 places to address the HSA in the program >>>

The HSA is handled in 3 parts in the TT program :

https://ttlc.intuit.com/community/health-care/help/what-is-a-health-savings-account-hsa/00/25765

First the contribution:

https://ttlc.intuit.com/community/entering-importing/help/where-do-i-enter-my-hsa-contribution/00/26...

https://turbotax.intuit.com/tax-tips/health-care/what-is-the-irs-form-8889/L8hRNHx4o

Next the limitations screen to confirm you are eligible to make the contributions:

Until you complete the HSA portion of the TurboTax interview to establish your eligibility for an HSA contribution, TurboTax will treat the amount entered on the W-2 form as an excess HSA contribution.

https://ttlc.intuit.com/community/health-care/help/why-am-i-showing-an-excess-hsa-contribution/00/26...

And lastly any distribution:

https://ttlc.intuit.com/community/health-care/help/why-is-my-hsa-distribution-taxable/00/26609

[rjs]

An HSA contribution of $7,300 will reduce your Adjusted Gross Income (AGI) by $7,300. But it does not reduce your tax by $7,300. The reduction in your tax depends on what tax bracket your income is in. If you are in the 22% tax bracket, a $7,300 reduction of your AGI will reduce your tax by $1,606 (22% of $7,300).

A change in AGI can have "side effects." It might increase or reduce certain other deductions or credits. So depending on what else is in your tax return, the change in the tax might not be the exact tax bracket percentage.

When you make the HSA contribution, be sure to tell the HSA trustee clearly that it is a 2022 contribution. Otherwise they will assume that it's for 2023.

If you have further questions, please give exact amounts, not rounded or approximate.

[Opus 17]

To contribute the maximum amount to your HSA, you must have been enrolled in an eligible HDHP and had no other disqualifying insurance for all the months of 2022, or, you were eligible in December 2022 and are going to use the last month rule, which requires that you remain eligible for all of 2023.

Yes, you can top off your HSA up until April 15, 2023, and have it counted for 2022. Make sure you inform the HSA bank in advance, if you contribute electronically, make sure you select 2022 on the contribution form.

If you also had payroll deductions to your HSA, remember that TurboTax will automatically fill that in from your W-2. Later in the program when you are asked about separate HSA contributions, only enter your own direct contributions not through payroll. If you enter your payroll deductions twice, TurboTax will think you over contributed and will assess a penalty.