Health Savings Accounts (HSAs) are a tax-advantaged way to save for medical expenses. They are typically paired with high-deductible health plans (HDHPs), offering individuals a triple tax advantage. One common question that individuals have is whether their employer's contributions to their HSA count towards the annual contribution limit. Here is what you need to know: - Employer contributions to your HSA count towards the annual maximum contribution limit set by the IRS. - The combined total of your contributions and your employer's contributions must not exceed the IRS annual contribution limit. - For 2021, the annual contribution limit for individuals is $3,600 and $7,200 for family coverage. - If you are 55 or older, you can make an additional catch-up contribution of $1,000. - Keep in mind that contributions from all sources, including employer contributions, are aggregated to ensure compliance with the annual limit. In summary, employer HSA contributions do count towards the contribution cap, so it's essential to monitor your contributions throughout the year to avoid exceeding the limit. If you have further questions about how HSA contributions work or need help maximizing the benefits of your HSA, consult with a financial advisor or tax professional.

When it comes to your Health Savings Account (HSA), understanding how employer contributions work is crucial to effectively managing your funds. Remember, employer contributions do count towards the IRS annual contribution cap, which means they can affect how much you can contribute on your own.