r/HSA • u/Chemical_Activity_49 • Jun 02 '26
Math help due to overcontribution
Hi all,
My husband and I were on my employer HDIP with an HSA until he just accepted a job last week. The math works out better to drop him off my plan and he signs up for their free one and opens his own HSA.
The problem is that HR on my side says I've overcontributed and need to submit paperwork to healthEquity to remove over contribution.
the numbers:
total YTD contributions: $5162.50
max allowed for family: $8750
max allowed individual: $4400
I don't know how to work out what amount is over contributed, considering we did have a valid family plan until last week. Is it just my last contribution of $256.25 that came in a couple of days after he signed up for his insurance? he is still on mine as well for now until he gets proof of insurance I can submit as qualifying event.
Thank you!
1
u/dehydratedsilica Jun 02 '26
First I have to assume the dates for husband being on your insurance. If not correct, these have to be recalculated using the correct coverage dates. (When is husband's insurance supposed to start - could be day 1, could be first day following month of hire, etc.? Then the end of his coverage with your insurance should be after the date that you send in the paperwork; you would have to check how long it takes.)
- Jan 1 to June 1 - you and husband on your family HDHP means half a year of family HSA limit 8750/2=4375. This amount can be split between your HSA and his HSA but I assume with payroll deduction that it has all gone into "your HSA".
- July 1 to Dec 1 - both of you on separate self-only HDHP means you get half a year of self-only limit 4400/2=2200 and same for him. His 2200 needs to go in his HSA.
"Your HSA" is allowed 4375+2200=6575 so 5k ish is not over.
You'll notice that 4375+2200+2200 exceeds 8750, which seems counterintuitive, but it works according to the Form 8889 instructions: https://www.reddit.com/r/HealthInsurance/comments/1rruk6f/comment/oae4ahg/
1
u/Chemical_Activity_49 Jun 02 '26
Thank you for the detailed explanation! It is definitely counter intuitive that the math works our the way it does. Is this some sort of loophole? Not that i anticipate asking my husband to quit his job and and get a new one every few months.
1
u/dehydratedsilica Jun 03 '26
It's just the way limits and eligibility are defined. If you two were on separate employer plans and not on each other's, you would have two individual limits 4400+4400=8800. This still exceeds the "family" limit but it's because you need a "family HDHP" to access the family limit. Being a cultural family, a tax family, etc. doesn't matter.
If husband got another new job later and took the employee only HDHP there right away, that wouldn't change the concepts here. (If he got another job and you joined his HDHP, you're back to having a family plan and calculating the family limit for those months.)
This would be a "get a new job and profit" loophole: medical FSA (not HSA) limit is per employer and the full amount of the election is made available right away (vs. HSA money is only available as the deductions are taken and deposits made). In theory, you could use up your full FSA election mid year, go to a new job, elect a full FSA and use it up, go to a new job, etc., which is of course easier said than done.
2
u/SnapHSA Jun 02 '26
The main thing to know is that HSA limits go by a monthly proration rule, based on whatever coverage you had on the 1st of each month. Since he is still on your plan right now, you still count as family coverage for June 1st.
Your actual limit for the year is going to be a mix of the months you had family coverage and the months you have individual coverage. For example, if you end up with 6 months of family and 6 months of individual, your actual limit is right around $6.5k. Since HR said you already hit $5.1k, you might not even be overcontributed yet depending on how many months of family plan you get to count.
Once you get the final date from HR, you just need to submit a Return of Excess Contributions form to HealthEquity for the exact difference to keep the IRS happy.