If you have qualified HDHP coverage on December 1 and maintain qualified HDHP coverage through December of the following year, you have the option to make up to a full year’s contribution instead of pro-rated contributions.
Examples for Calculating Pro-Rated Maximum Contributions
- Bob is younger than age 55. He was covered by an individual HDHP for six months before losing his coverage. What’s the maximum amount he can contribute to his HSA that year? In 2020, the maximum contribution for individual coverage is $3,550. Because Bob was covered by a HDHP for six months (half) of the year, he can contribute half of the maximum amount allowed of $1,775 ($3,550 ÷ 12 months x 6 months = $1,775).
- Lynn, age 58, was covered by a family HDHP for five full months of the calendar year. In 2020, the maximum contribution for family coverage is $7,100, plus an annual catch-up contribution of $1,000 for each spouse over age 55. Because Lynn was covered for five months, she can contribute 5/12 of $8,100 or $3,375 ($8,100 ÷ 12 months x 5 months = $3,375).
Please keep in mind that contributions from more than one source (for example, you contribute to your HSA and your employer does as well) and contributions to more than one HSA all count toward the same yearly limit.