Can I Contribute to HSA While on COBRA?

If you are on COBRA (Consolidated Omnibus Budget Reconciliation Act) after leaving your job, you might be wondering about contributing to your HSA (Health Savings Account).

COBRA allows you to continue your employer-sponsored health plan for a limited time, but how does it impact your HSA contributions?

Here’s what you need to know:

• While on COBRA, you can still contribute to your HSA if you are eligible.
• COBRA does not prevent you from making contributions to your HSA.
• However, you need to be enrolled in a high-deductible health plan (HDHP) to qualify for HSA contributions.
• If you were enrolled in an HDHP through your previous employer, you can continue to contribute to your HSA while on COBRA.
• Contributions to your HSA while on COBRA are still tax-deductible and grow tax-free.

It’s essential to understand the rules and requirements to make informed decisions about your HSA contributions while on COBRA.

If you find yourself on COBRA (Consolidated Omnibus Budget Reconciliation Act) after leaving a job, it's crucial to know that you can indeed contribute to your HSA (Health Savings Account), provided you're eligible.

COBRA allows you to maintain your employer-sponsored health coverage temporarily, but it does not stop you from making HSA contributions.

Importantly, you still need to be enrolled in a high-deductible health plan (HDHP) to qualify for those contributions. If your previous employer provided you with an HDHP, you're in luck – you can keep contributing to your HSA while on COBRA.

Remember, the best part is that contributions remain tax-deductible and your HSA savings grow tax-free. Therefore, being aware of these facts can significantly benefit your long-term healthcare savings.