Understanding HSA Overfunding for 2018

Health Savings Accounts (HSAs) have become a popular way for individuals to save money for medical expenses while enjoying tax advantages. However, it is essential to understand the rules and limits of HSA contributions to avoid overfunding.

For the year 2018, the maximum HSA contribution limits were set at $3,450 for individuals and $6,900 for families. Overfunding occurs when contributions exceed these limits, leading to penalties and tax implications.

If you have overfunded your HSA for 2018, it is important to rectify the situation promptly to avoid penalties. The excess contributions must be removed from the account by the tax filing deadline to prevent taxation and penalties.

Health Savings Accounts (HSAs) offer a tax-advantaged way to save for healthcare expenses, and understanding their limits is crucial to avoid overfunding. For the year 2018, the maximum contributions allowed were $3,450 for individuals and $6,900 for families. If your contributions surpass these limits, you could face unwanted tax penalties.