Are HSA Contributions Per Calendar Year?

Health Savings Accounts (HSAs) are a valuable tool for individuals looking to save money and cover medical expenses tax-free. One common question that arises is whether HSA contributions are per calendar year. The answer is yes, HSA contributions are indeed on a per calendar year basis.

Here are some key points to note about HSA contributions:

• HSA contributions can be made by the account holder, their employer, or both.
• Contributions made by the employer are tax-deductible for the employer and are excluded from the employee's gross income.
• For 2021, the annual contribution limits are $3,600 for individuals and $7,200 for families.
• Individuals aged 55 and older can make an additional catch-up contribution of $1,000 per year.

It's important to stay within the annual contribution limits to avoid potential tax penalties. Any contributions made above the limits are subject to an excise tax.

Health Savings Accounts (HSAs) are not just a way to save for medical expenses; they also provide an excellent opportunity to grow your savings. As a reminder, HSA contributions are considered on a per calendar year basis.