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New Member
posted May 31, 2019 11:40:21 PM

Did I make a contribution based on the last month rule if I was enrolled in a HDHP all year?

I have been enrolled in the same HDHP the past 5 years. Does that mean I made contributions to my HSA based on the last month rule?

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2 Replies
Level 8
May 31, 2019 11:40:23 PM

No. This does not apply to you. The last month rule is used when enrolled in HDHP for less than a full year.

Level 8
May 31, 2019 11:40:27 PM

Explanation of last month rule (LMR):
If you were HDHP covered for only a few months at the end of 2015 (including December) and elected to use the LMR, you could make a 2015 contribution that exceeds the amount allowed for those few months of coverage. The LMR allows you to make up to a full year contribution and only be covered for December of the year. BUT, you must then remain eligible (have HDHP coverage) for the entire following year or else pay tax and penalty for making the LMR contribution for the previous year.