2017 might be in the past, but you can still make 2017 HSA contributions. Understanding the IRS HSA guidelines allow you to deduct more tax savings from your 2017 tax returns.

2017 HSA Contribution Details

In 2017, the maximum HSA contributions were $3,400 for individuals and $6,750 for families (If you want to review the 2018 HSA contribution details, click here).

The total amount you contribute to your 2017 HSA is based on these factors:

1. Pro-rated HSA Contributions. The most straightforward way to understand HSA contribution limits for mid-year changes is to contribute based on a pro-rated calendar schedule. HSA eligibility is determined on the 1st of every month. For example, if your HSA-eligible health plan started on October 15th, you can begin 2017 contributions to your HSA on November 1st. As such, your HSA (individual or family) would be prorated for 2 months (out of 12) for 2017. However, if your health plan started on the 1st of any month, you would not have to wait until the next month to begin contributing. This should help you understand your maximum 2017 HSA contribution.

2. Catch-Up Contributions. If you are 55 years or older, you can add an extra $1,000 to your HSA contributions each year. The full amount of $1,000 is allowed no matter when you turn 55 years of age in that calendar year. The same is true of your spouse if you have a family HSA plan (although you will need to create a separate HSA for your spouse to take advantage of his/her own catch-up contribution amount). Just keep in mind that the $1,000 would also be pro-rated if your HDHP wasn’t in effect all year.

3. Last Month “December” Rule. There is one big tax caveat here. Based on HSA-eligible health plan start date or termination dates, there is an overriding HSA contribution rule, aka the Last Month or “December” rule. Any person with an HSA can make a full year 2017 contribution if he/she is covered on an HSA-eligible health plan on December 1, 2017, AND maintains eligible coverage through December 31, 2018. This means you can contribute the maximum 2017 HSA contribution amount if you were covered on December 1, 2017. WOW!

2017 HSA Contribution Requirements

• You had an HSA-eligible plan for sometime in 2017. Under 2017 federal regulations, HSA-eligible plans that qualify must have deductibles of $1,300 or more for an individual and $2,600 for a family.

• You contribute your 2017 HSA funds before tax day (April 17, 2018). Tip: don’t wait until the very last day. It usually takes a few business days for funds to post to your account!

Maximizing Tax Savings

Using your HSA to maximize your 2017 tax deductions can help you save money on your taxes. In addition, you are a year ahead in building an HSA nest egg that you can save, spend or invest.

If you need more help with health account decisions, check out our blog. We will make you a healthcare benefits expert in no time, without any extra work or effort on your end.