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Why am I showing an excess HSA contribution in 2021?

SOLVEDby TurboTax1891Updated April 15, 2022

For 2021, the maximum combined total that you, your employer, and/or any other eligible person can contribute to your HSA account is:

  • $3,600 if you're under 55 at the end of 2021 and are covered by an individual (self-only) HDHP;
  • $7,200 if you're under 55 at the end of 2021 and are covered by a family HDHP;
  • $4,600 if you're 55 or older at the end of 2021 and are covered by an individual (self-only) HDHP;
  • $8,200 if you're 55 or older at the end of 2021 and are covered by a family HDHP.

If you overfunded or weren't eligible to contribute to your HSA in 2021, you'll need to withdraw the excess amount by April 18, 2022 to avoid a penalty (October 15 if you filed an extension).

Some things to keep in mind:

  • The above limits are prorated depending on the number of months you were covered by an HDHP and had no additional health coverage
  • If you were only covered by an HDHP for part of the year, your contribution limit may be lower than above limits
  • If you're covered by an HDHP on the first day of the month, you're considered covered for the entire month
  • If you had HDHP coverage on December 1 (the last month of the year), then you can use the full annual HSA contribution limit for your HDHP coverage, regardless of the number of months you had coverage
  • Spouses on separate plans: The $7,200 family limit applies to married couples even if one spouse is covered by a family plan and the other spouse has their own individual plan. In this scenario, the couple may split their contributions any way they like, as long as the couple's total contribution doesn't exceed $7,200. Spouses 55 or older at the end of 2021 are allowed to contribute an additional $1,000 to their own HSA.

We recommend revisiting the HSA entry screens to make sure the excess contribution wasn't due to an entry error. Here's how:

  1. With your return open, search for hsa inside your program and then select the Jump to link to open the HSA summary screen. On that screen, select Edit.
  2. Step through the interview until you reach Let's enter your HSA contributions.
  3. On that screen, make sure you didn't accidentally re-enter the amount already listed (from box 12 of your W-2) as this will incorrectly double your total contribution amount.
  4. Continue through the HSA screens, making sure you answered all questions correctly. To be eligible to contribute to an HSA in 2021, you:
    • Must have been covered by a high-deductible health plan (HDHP)
    • Didn't have Medicare or other secondary health insurance policy
    • Weren't eligible to be claimed as a dependent on another return, no matter if you were claimed or not.
  5. Spouses on separate plans: If one spouse is covered by a family plan and the other spouse has their own individual plan, the maximum allowable contribution for the couple is $7,200 – not $10,800 – as explained above.
  6. Excess contribution in 2020: If you overfunded your HSA last year but withdrew the excess by the due date of your 2020 return, answer No to Did you overfund your HSA in 2020?

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