Health plan changes during the year are common. A spouse might need to join your HSA-qualified health plan in between jobs, or a child might need to unenroll from your plan to join your spouse's. These changes can impact your HSA contribution limits—let's break down the factors.
Individual and family contribution limits
Health savings accounts have two types of limits: individual (aka self-only) and family contribution limits. These limits are updated annually.
HSA-qualified HDHP
Each year, the IRS sets criteria for HSA-qualified high-deductible health plans. The criteria include minimum deductibles and out-of-pocket maximums.
The IRS defines family coverage as any coverage other than self-only coverage. Examples of family coverage include individual and spouse, individual and children, or individual and spouse and children.
Individual Coverage: A HSA is linked to a high-deductible health plan that covers only the individual account holder and meets the criteria set by the IRS for HSA eligibility.
Family Coverage: An HSA linked to a high-deductible health plan that covers more than just the individual account holder and meets the criteria set by the IRS for HSA eligibility. Typically, it covers the account holder, their spouse, and any dependents.
HSA Contribution Limits for 2024
$4,150 for self-only coverage and $8,300 for family coverage.
Source: IRS Rev. Proc. 2023-23
Enrolled family member mid-year
If you add a family member (spouse or dependent) to your HSA-qualified health plan, you can start contributing toward a pro-rated family limit. Calculate (via the pro-rated limit) your family contribution limit for the year and your individual contribution limit for the year based on your health plan timelines.
Debit card for family members
For easier access to funds, you can issue a debit card for the family member added to your health plan.
Unenrolled family member mid-year
If you remove a family member from your health plan, you will need to contribute toward a pro-rated limit based on the timeline you were eligible for the family limit and the timeline you would be eligible for the individual limit. Calculate (via the pro-rated limit) your family contribution limit for the year and your individual contribution limit for the year based on your health plan timelines.
Divorce and HSAs
If you decide to transfer HSA assets as part of divorce proceedings, that transfer is not taxable - in other words, your spouse still gets the tax-free treatment of HSA assets during and after the transfer.