HSA and HDHP

[Petecruiz]

I couldn't find good detailed information pertaining to HSA benefits eligibility except that one must have an HDHP plan during the year of contribution. My questions are:

1- can one have an employer PPO plan and purchase a second low cost HDHP plan for the purpose of satisfying pretax contribution requirements of HSA?
2- There is no clarity on how long an HDHP plan should be held during the contribution year , t I found a post somewhere state at least 1 month of HDHP will make the HSA contribution eligible for that year.
3- would the duration of owning HDHP effect the maximum allowed contribution limit? if owned in Jan??

 

[leevena]

1. No.
2. True. You could purchase a HDHP for January 1, contribute the full amount, cancel coverage after 1 month.
3. No

 

[WTX2WY]

Pretty sure you can only contribute a prorated amount if you do not keep the plan for the entire year. For example, drop it after one month and you can only contribute 1/12*3600=300.

I could be wrong though, I am no expert on HSAs but did study up on them in December before deciding to purchase a HDHP plan.

 

[Yagents]

Pretty sure you can only contribute a prorated amount if you do not keep the plan for the entire year. For example, drop it after one month and you can only contribute 1/12*3600=300.

I could be wrong though, I am no expert on HSAs but did study up on them in December before deciding to purchase a HDHP plan.

This is correct. Must be pro rated by number of months hdhp is owned.

If nov 2019 to oct 2020, the yes, can contribute full amount for first 2019 tax year, but no double dipping. No 2020 contribution unless you own it through oct 2021.

But of course, the irs has no way of checking if hdhp is owned.

 

[bmarsh]

This is correct. Must be pro rated by number of months hdhp is owned.

If nov 2019 to oct 2020, the yes, can contribute full amount for first 2019 tax year, but no double dipping. No 2020 contribution unless you own it through oct 2021.

But of course, the irs has no way of checking if hdhp is owned.

Except for those 1095-A forms

 

[Yagents]

Looking at my group 1095B document, it says nothing about it being an HSA eligible plan that it is.

It gives you 7 codes to choose from for box # 8

SHOP
Employer group
Gov't program
IFP
HRA
other MEC

It was strictly to show proof of coverage and avoid the penalties

 

[LostDollar]

Except for those 1095-A forms

5498-SA
1099-SA

 

[LostDollar]

Pretty sure you can only contribute a prorated amount if you do not keep the plan for the entire year. For example, drop it after one month and you can only contribute 1/12*3600=300.

I could be wrong though, I am no expert on HSAs but did study up on them in December before deciding to purchase a HDHP plan.

Yes

https://www.optum.com/content/dam/optum/consumer-activation/PRJ2053/59520_HSA_Mid-year_changes.pdf

 

[Yagents]

Thanks for taking time to prove me right LD. You are a great wingman.

 

[EvanT]

I have a situational question. My wife and I are looking to go with my employer's HSA option for the immediate and long-term benefits. However - we know we will be attempting in vitro fertilization (IVF) at the end of this year. I'm reading mixed things on fertility treatments and whether or not they are covered. This will also be our 2nd IVF after a successful first one (not sure if that's necessary info but including it). Company insurance is Cigna. I'm sure it's still a breakeven analysis based on the costs we expect, but was hoping there may be someone out there that knows more than we do about HSAs and infertility-based medical costs. Any input would be appreciated. Our current insurance is an HMO plan with higher premiums but a slightly lower deductible.