People who enroll in Medicare later within the 12 months could also be entitled to make HSA contributions for months when they don’t seem to be enrolled in Medicare protection. In different phrases, a prorated contribution for the 12 months could also be allowed. Shoppers, although, ought to keep in mind the six-month retroactive window when calculating their HSA contribution restrict for the partial 12 months.
Even when purchasers aren’t eligible to fund an HSA, they’ll proceed to make use of present HSA funds. These funds can be found tax-free so long as they’re used to pay for qualifying medical bills, together with conventional Medicare premiums for Components A, B, C and D, however excluding premiums for supplemental Medicare applications.
Taxpayers can use HSA funds to reimburse themselves for Medicare premiums which might be withdrawn straight from their Social Safety advantages, but it surely’s necessary to maintain data to substantiate the HSA withdrawals.
Persevering with Spousal Contributions
Whereas somebody who enrolls in Medicare is not in a position to fund an HSA, that particular person’s enrollment doesn’t have an effect on a partner’s capacity to fund their very own HSA. People who select to proceed working after enrolling in Medicare can elect to take care of their employer-sponsored plan for the good thing about their partner and different dependents who aren’t eligible for Medicare.
In these circumstances, the precise worker stays ineligible to fund an HSA. The partner, nevertheless, can open and fund their very own HSA primarily based on their partner’s employer-sponsored high-deductible well being plan protection. That partner can fund their account as much as the contribution limits for household protection for the 12 months.
By definition, the employee-spouse has elected household well being protection with a view to present protection for his or her partner. In 2024, the partner can contribute as much as $8,300 to their HSA (rising to $8,550 in 2025). If the partner is age 55 or older, they’ll additionally make the most of a $1,000 catch-up contribution.
Word that whereas joint HSAs don’t exist, the 2 spouses can use the funds in one another’s HSAs with none limitations.
When a high-deductible well being plan participant’s partner enrolls in Medicare, the participant can proceed to fund their HSA. Nonetheless, it’s attainable that their contribution restrict could change from the household to particular person protection restrict ($4,300 in 2025 and $4,150 in 2024) if the participant-spouse not maintains household protection. If the participant-spouse maintains household protection, they proceed to benefit from the household protection contribution restrict although their partner can not contribute after enrolling in Medicare.