What is my max hsa deduction for 2018 if I am 69 years old?

[Critter]

Contributions cannot be made if you are on Medicare.

[BMcCalpin · Accepted solution]

Critter#2 is correct that you cannot contribute to an HSA if you are on Medicare. But because not all seniors are on Medicare, please read the following.

The HSA contribution limits for taxpayers 55 and over are somewhat complex, so while the following answer is lengthy, it needs to be to cover each case that may apply to you.

For 2019, if you have self-only HDHP coverage, you can contribute up to $3,500. If you have family HDHP coverage, you can contribute up to $7,000.

You increase the limit by $1,000 for each taxpayer who is 55 or older. Thus, the maximum contribution allowed for a taxpayer, age 69, who has self-only HDHP (High Deductible Health Plan) coverage would be $4,500.

The maximum contribution limit for a taxpayer under family HDHP coverage in 2019 is $7,000. If the taxpayer with the HSA is 55 or older, this amount is increased to $8,000. 

If the spouse is also under an HDHP and has an HSA, the maximum aggregate contribution limit for the two HSAs is still

• $7,000 if neither taxpayer is 55 or over,
• $8,000 if one taxpayer is 55 or older,
• $9,000 if both taxpayers are 55 or over.*** see below

***Note that an HSA belongs to an individual. Even if both spouses are covered by a family HDHP plan, they do not have a joint HSA, but either (1) one taxpayer has the HSA or (2) each taxpayer can have his/her HSA. But the absolute contribution limit for a taxpayer 55 or over to his/her HSA is $8,000. This means that if the two taxpayers qualify for the $9,000 limit, then at least $1,000 must go into the spouse’s HSA (except for the $1,000 minimum in this case to each HSA, the contributions under the Family limit can be divided between the two HSAs as the taxpayers see fit).

[Edited 3/17/2020 4:09 pm CDT - updated for 2019]

[ghost]

@TurboTaxBillMc For spouses who both have self HDHP coverage (and never family HDHP coverage), Form 8889 (each spouse is required to complete Form 8889) instruction tells each spouse to determine the limit (line 3) independently. The result is $3400 contribution to each spouse's HSA and if a spouse is age 55 or more, that spouse is allowed an additional $1000 contribution to their HSA.
So, if both spouses are at least age 55 and are covered by self HDHPs, the total amount in each HSA will be $4400 or $8800 in total.

[dmertz]

The regular contribution limit for self-only coverage for *2018* is $3,450, up $50 from the $3,400 for 2017.

[BMcCalpin]

Thank you, rebab, for clarifying that the admittedly rare case of two spouses each with self-only HDHP coverage has a maximum limit of $8,800 (2 times $4,400) instead of the more usual case of one or both spouses having family HDHP coverage, in which case the limit is $7,750 for one spouse having an HSA and $8,750 for both spouses having HSAs, with at least $1,000 going to each HSA (assuming that the HSA holders are 55+).

[BMcCalpin]

Thank you, dmertz, for reminding us that while our clients are doing their 2017 tax returns with the limits above, our clients are now already living in the 2018 tax year, in which case their current ongoing HSA contributions have an increased limit for 2018.

[SweetieJean]

and yet the IRS still refers to it as the "2018 Tax Filing Season"!

[ghost]

@SweetieJean only the government can make things more confusing. 😉