What Are the Rules for Contributing to an HSA in the Year in Which You Sign Up for Medicare?
Jeffrey Levine of Buckingham Wealth Partners, aka “The Buckinghammer” explains the complicated rules for contributing to an HSA (health savings account) in the year in which you sign up for Medicare. A health savings account (HSA) is a tax-advantaged medical savings account available to taxpayers in the United States who are enrolled in a high-deductible health plan.
Key Takeaways
- Once enrolled in Medicare, you cannot contribute to an HSA—stop contributions at actual enrollment, not when you first become eligible to sign up 3 months before age 65
- Check for a potential 6-month lookback period: if you plan to enroll in Medicare, consider stopping HSA contributions up to 6 months before your Medicare coverage begins to avoid the 6% annual penalty
- If you're covered under a family HSA plan and one spouse enrolls in Medicare, the younger spouse may continue contributing as a single individual for self-only coverage
- Prorate your annual HSA contribution by month: contribute only for months when you're eligible, breaking your annual limit into monthly amounts to maximize tax-advantaged savings
What Are the Rules for Contributing to an HSA in the Year in Which You Sign Up for Medicare? Jeffrey Levine of Buckingham Wealth Partners, aka “The Buckinghammer” explains the complicated rules for contributing to an HSA (health savings account) in the year in which you sign up for Medicare. A health savings account (HSA) is a tax-advantaged medical savings account available to taxpayers in the United States who are enrolled in a high-deductible health plan. Watch more episodes of Ask The Hammer at this link: https://www.finstream.tv/videos/ask-the-hammer/
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