Who Can Contribute to HSA? An Overview of HSA Contribution Eligibility

Health Savings Accounts (HSAs) have become popular tools for saving on medical expenses while enjoy tax advantages. Understanding who can contribute to an HSA is important for maximizing its benefits.

Any eligible individual can contribute to an HSA, which includes those who:

• Are covered by a High Deductible Health Plan (HDHP)
• Are not enrolled in Medicare
• Cannot be claimed as a dependent on someone else's tax return

Employers, family members, and the account holder themselves can contribute to an HSA. Contributions can be made through payroll deductions, directly into the account, or through a one-time lump sum.

It's important to note that HSA contribution limits are set annually by the IRS. For 2020, the contribution limit for individuals is $3,550, and for families, it's $7,100. Individuals aged 55 and older can make an additional catch-up contribution of $1,000.

Health Savings Accounts (HSAs) are valuable financial tools that empower individuals to save on medical costs while enjoying tax benefits. To fully take advantage of an HSA, it’s crucial to understand who is eligible to contribute.