Using 2023 TurboTax software, filing married joint return. Both myself and wife had contributions into HSAs as noted on W-2, each contributing 8 mos under Self Only HDHP plans, then 4 mos under a HDHP Family Plan as my wife retired and I added her to my High Deductible Health Plan. TT states, "Your maximum contribution limit is $8,750", which I am assuming to be our combined limit. But, does this max contribution limit TT is showing include the catch-up contribution of $1,000 we are EACH eligible for?
I want to make the maximum contributions allowable for 2023 in both of our HSAs, but am not sure how much extra I can contribute. Help me through the calculations.
The $8,750 that TurboTax indicates includes only the $1,000 catch up for the particular individual for which TurboTax is calculating the contribution limit. The other spouse needs to make their $1,000 catch-up contribution to their own HSA account. The $7,750 regular family contribution can be divided between the spouses in any way you see fit, but the each spouse must make their own $1,000 catch-up contribution. If you contribute the full $7,750 family limit to your HSA plus your $1,000 catch-up, your spouse can contribute only the $1,000 catch-up to your spouse's HSA.
Turbo Tax says...
Yes, the maximum contribution limit of $8,750 for 2023 includes the catch-up contribution of $1,000 that both you and your spouse are eligible for if you are both 55 or older at the end of 2023 and covered by a family HDHP. Keep in mind that the contribution limit is prorated based on the number of months you were covered by an HDHP and had no additional health coverage. If you overfunded or weren't eligible to contribute to your HSA in 2023, you'll need to withdraw the excess amount by April 15, 2024 to avoid a penalty (October 15 if you filed an extension). We recommend revisiting the HSA entry screens to make sure the excess contribution wasn't due to an entry error.
The $8,750 that TurboTax indicates includes only the $1,000 catch up for the particular individual for which TurboTax is calculating the contribution limit. The other spouse needs to make their $1,000 catch-up contribution to their own HSA account. The $7,750 regular family contribution can be divided between the spouses in any way you see fit, but the each spouse must make their own $1,000 catch-up contribution. If you contribute the full $7,750 family limit to your HSA plus your $1,000 catch-up, your spouse can contribute only the $1,000 catch-up to your spouse's HSA.