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Level 3
posted Jun 3, 2019 10:19:31 AM

Enrolled in HDHP only for Decembr, per last month rule contributed $3,400 to HSA, deduction should be $283 ($3,400/12). TurboTax Deluxe not calculating and using $3,400.

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1 Best answer
Intuit Alumni
Jun 3, 2019 10:19:32 AM

TurboTax is correct to use the entire $3400. 

That is the purpose of the last-month rule.  It allows you to claim the full deduction as if you had been enrolled for the entire year.  However, you must remain enrolled for the coming year in order for that contribution to not be penalized on your 2018 tax return.


3 Replies
Intuit Alumni
Jun 3, 2019 10:19:32 AM

TurboTax is correct to use the entire $3400. 

That is the purpose of the last-month rule.  It allows you to claim the full deduction as if you had been enrolled for the entire year.  However, you must remain enrolled for the coming year in order for that contribution to not be penalized on your 2018 tax return.


Level 15
Jun 3, 2019 10:19:33 AM

If it's your preference to have TurboTax calculate the permissible maximum contribution without regard to the last-month rule, say, because you do not expect to be able to satisfy the testing period for the last-month rule, simply indicate that you were not an eligible individual for December and indicate instead that you were eligible for some other month (some other month that you were not actually eligible).

Level 3
Jun 3, 2019 10:19:35 AM

I misread the instructions for 8889. One is "deemed" eligible therefore can deduct for entire year.