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Employer HSA Contributions

Lively · May 22, 2018 · 3 min read


HSA contributions create a clear path to dedicated health savings for any qualified out-of-pocket medical expenses. Employer payroll deductions ensure employees are saving pre-tax dollars. These pre-tax contributions help employees reduce real cost increases to healthcare costs.

Employer contributions to an HSA are almost like free money. They are tax-free money any employee can use regardless of income level or financial situation. So how do employer HSA contributions work?

Can an employer contribute to an employee's HSA?

100% Yes! In fact, anyone can contribute to an HSA. There is no limit on the number of people who can contribute to an HSA. This means more money for health savings for today or well into retirement.

Are employer HSA cntributions tax-free?

Yes! They are tax-free for employees and have tax-advantages for employers, as long as they are within the yearly HSA contribution limit. Employer HSA contributions and employee contributions running through payroll on a pre-tax basis are not subject to FICA taxes (7.65%). In addition, HSA contributions are a tax-deductible expense for most employers (be sure to consult with your tax accountant).

What are employer HSA contribution limits?

Yearly HSA contribution limits are not defined by the contribution party, but rather the total amount. This means employers can contribute 100% of an employee's yearly HSA contributions as long as the employee's maximum contributions don't exceed this yearly IRS HSA contribution limit.

Can employees deduct employer HSA contributions?

No, employees can't deduct employer HSA contributions, because they are already pre-tax dollars. However, contributions to your HSA made by your employer (including contributions made through a cafeteria plan) may be excluded from your gross income. On top of that, if anyone other than your Employer contributes, that 3rd party contribution would actually reduce your taxable income (vs. excluding it from your income).

These funds, like all HSA funds have triple tax advantages: tax-free contributions, tax-free growth and tax-free distributions (as long as they are used for qualified out-of-pocket medical expenses).

Employees who are lucky enough to receive employer HSA contributions are getting free money to save for health costs. This is an incredible financial cushion employers can provide employees to limit increases in health costs. Employer HSA contributions become a lifetime resources employees can use this year or in retirement, for health costs.

Getting started with Lively

If your company is looking to offer employs an easy-to-use HSA that enables first-dollar investing and a simple, user-friendly dashboard, as well as straightforward integrations for systems and software you already use, reach out to Lively today.



Lively is the modern HSA experience built for—and by—those seeking stability in the ever-shifting healthcare landscape. By harnessing modern innovation and deep industry expertise, Lively is committed to bridging today’s savings with tomorrow’s unknowns. Unlike traditional institutions hindered by bureaucracy, Lively’s commitment extends beyond initial set up to providing dedicated, ongoing support and education for every step. So each HSA can reach its maximum potential with minimal headache.

piggy bank on pink background


2024 and 2025 HSA Maximum Contribution Limits

Lively · May 9, 2024 · 3 min read

On May 9, 2024 the Internal Revenue Service announced the HSA contribution limits for 2025. For 2025 HSA-eligible account holders are allowed to contribute: $4,300 for individual coverage and $8,500 for family coverage. If you are 55 years or older, you’re still eligible to contribute an extra $1,000 catch-up contribution.

comparing hsa versus fsa


What is the Difference Between a Flexible Spending Account and a Health Savings Account?

Lauren Hargrave · February 9, 2024 · 12 min read

A Health Savings Account (HSA) and Healthcare Flexible Spending Account (FSA) provide up to 30% savings on out-of-pocket healthcare expenses. That’s good news. Except you can’t contribute to an HSA and Healthcare FSA at the same time. So what if your employer offers both benefits? How do you choose which account type is best for you? Let’s explore the advantages of each to help you decide which wins in HSA vs FSA.

Benefits of HSA employer matching

Health Savings Accounts

Ways Health Savings Account Matching Benefits Employers

Lauren Hargrave · October 13, 2023 · 7 min read

Employers need employees to adopt and engage with their benefits and one way to encourage employees to adopt and contribute to (i.e. engage with) an HSA, is for employers to match employees’ contributions.

Disclaimer: the content presented in this article are for informational purposes only, and is not, and must not be considered tax, investment, legal, accounting or financial planning advice, nor a recommendation as to a specific course of action. Investors should consult all available information, including fund prospectuses, and consult with appropriate tax, investment, accounting, legal, and accounting professionals, as appropriate, before making any investment or utilizing any financial planning strategy.



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