What You Need to Know About HSA Contributions

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Many schools, cities, and counties offer their employees a high deductible health plan (HDHP) to help control costs. They may choose to pair this coverage with a health savings account (HSA) to help their employees with health care expenses.

An HSA is an account that can be contributed to by or on behalf of an eligible individual. It can be used to pay for qualified medical expenses including dental or vision expenses, or expenses covered under the HDHPs.

Below are the revised contribution limits and rules.

Contribution Limits

• For 2020, $3,550 single coverage and $7,100 for family coverage.
• Employees age 55 or older can make an additional $1,000 “catch-up” contribution.

Contribution Rules

• A special contribution limit applies to married spouses when either spouse has family HDHP coverage.
• For each month an employee is HSA-eligible, they may contribute one-twelfth of the applicable maximum contribution limit.
• The full-contribution rule allows an employee who is HSA-eligible for only part of the year to make a full year’s worth of HSA contributions.

Download the bulletin for more details.