Enrolled in Medicare at 65 but still working and using Employers Heathcare

[Don1957]

While filling out Deduction & Credits I ran into a Question "Did you have Medicare at any time in 2022?  In May I turned 65 and enrolled in Medicare but continue to work.  I have myself and my daughter on my Employers plan.  So, I had Medicare but did not use it even though I had to enroll and tell them I was continuing to work.

Do I say Yes or No?

[BillM223]

Was this question in the HSA interview? If so, answer YES that you are on Medicare.

Otherwise tell me where this question is (tell me the heading at the top of the screen).

[Don1957]

Thank you for your reply.  I answered Yes to the question, and it takes me to a "Let's maximize your contribution limit" screen.  It shows a monthly breakdown of HDHP coverage by month.  I enrolled in Medicare as required on my 65th birthday in May but continued to work full time.  I have my daughter and myself on a Medical plan which I am assuming is a Family Plan (HDHP).  It is not clear if I select Family Plan for each month or if I have to select Medicare or None starting May.   If I select None, it thinks my HDHP ended?

Thank you for your assistance!

Don

[RalphH1]

I’m not completely clear on this from reading, but am assuming that you had a high-deductible health plan and a “Health Savings Account” to which you contributed in 2022. (As BillM223 was clarifying, you’re apparently in that part of the TurboTax HSA interface, and it would be irrelevant if you didn’t have actually have such an account too, as the health plan itself is only tax-relevant for possible premium deductions).

Assuming you did have an HSA, the TurboTax program should be advising you that if you were “covered by a High Deductible Health Plan (HDHP) and Medicare…during the same month, select None” (this represents a month for which you’re not allowed an HSA contribution). So I think this means May through December will be “none” for you, and assuming you had just the high-deductible plan and no other non-high deductible plan for January through April, the program should correctly prorate your maximum HSA contribution for the year by 4/12 of the $7,300. (And if you actually contributed more than that, it will discuss the penalty for an excess contribution, unless you take it out before April 18th. Here’s the scoop on that.) Thanks Don1957 and Bill!

[Opus 17]

You are not eligible to make HSA contributions if you have any "other medical coverage".  This includes Medicare, so if you enrolled in medicare on May 1, that stopped your ability to contribute to an HSA, even if you were still enrolled in an HDHP.  You can continue to spend the money in the account, but you can't contribute new money.  If you made HSA contributions, you may have contributed too much, in which case you must withdraw the excess or pay a penalty.

Incidentally, if your daughter is "covered" by your HDHP, and is not your tax dependent, she can contribute to an HSA in her own name because she is "covered" even though she is not the policy owner.  This situation will typically occur when a child is too old to be a tax dependent (age 19 or older and not a full time student, or age 24 or older, and earning more than $4400 in the year) but under age 26 and covered by a parent's insurance.  So it's a limited window, but if your child is in that window, she can have her own HSA. 

[Don1957]

Thank you for the information.  I enrolled in Medicare Part A (hospital) only.  I was advised that I was required to do so to keep my other benefits available when I do fully retire.  I am working full time and have a Medical Plan through my employer that covers myself and my daughter.   I am sure I will run into this again next year, but for now I checked Medicare or None which did not put me over the Contribution limit.

Thank you again for your assistance. 

Don