How to Count HSA Contributions?

When it comes to Health Savings Accounts (HSAs), understanding how to count contributions correctly is essential for maximizing the benefits and tax advantages they offer.

To count HSA contributions:

1. Know the annual contribution limits set by the IRS for individuals and families.
2. Take into account any employer contributions made to your HSA on your behalf.
3. Verify if you are eligible for catch-up contributions if you are 55 years or older.
4. Keep track of your own contributions made directly to your HSA.
5. Combine all contributions to ensure they do not exceed the annual limits.

By following these steps, you can accurately count your HSA contributions and avoid costly penalties or tax implications.

Counting HSA contributions might seem daunting, but it becomes straightforward when you break it down into manageable parts. The first step is knowing the annual limits; for 2023, the maximum contribution is $3,850 for individuals and $7,750 for families.