HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

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mhc
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Re: IRS reduces HSA max for 2018

Post by mhc »

Thank you for the heads up.

I just called Fidelity to lower my contributions for the year. 12 minutes on the phone for $50 difference. Not very efficient.

Fidelity's benefits department was fully aware of this. I bet most employees are not aware of the change.
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LadyGeek
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Re: HSA family max contribution lowered to $6850 for 2018

Post by LadyGeek »

^^^ I merged PaddyMac's thread into here.
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toblerone
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Re: HSA family max contribution lowered to $6850 for 2018

Post by toblerone »

OP here, with an update on the ordeal.

I had to fill out a form provided by Optum to remove the excess contribution.
I had to FAX the form to Optum.
A few days later, my account online showed the excess contribution removed.
About a week after that, I received a paper check in the mail for the excess plus the gains, around $56 total.
I deposited the check at my bank.
I'm not sure about future tax return consequences for 2018.

If it weren't for the faxing, or having to deposit a check at the bank, it would not have been a big deal. But for $50 it was really stupid. I have a feeling the lost productivity in the USA far outweighed the tax revenues to the USA.
Alan S.
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Re: HSA family max contribution lowered to $6850 for 2018

Post by Alan S. »

Here is the latest on possible relief from the 2018 contribution reduction:

http://www.seyfarth.com/publications/OMM040518-EB

Again, it is worth waiting to see if any relief granted is in a form more attractive than acting on your own.
Chicago60
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Re: HSA family max contribution lowered to $6850 for 2018

Post by Chicago60 »

I completed the form I printed online from 5th 3d Bank, mailed it, and the overfunding of $50 was deposited in my checking account promptly, without a fee. Maybe took me 5 minutes time in total.
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Edie
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Re: HSA family max contribution lowered to $6850 for 2018

Post by Edie »

motorcyclesarecool
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Re: HSA maximum back to $6900 for 2018!

Post by motorcyclesarecool »

motorcyclesarecool wrote: Wed Mar 07, 2018 11:37 pm
Spirit Rider wrote: Wed Mar 07, 2018 11:08 pmHow is following the law being disgruntled.
I don’t wish to get into an argument, but I will cite one example of disgruntled employees working to the letter:

http://articles.latimes.com/2000/aug/27/news/mn-11154

In multiple levels of government, I have found Yes, Minister to be very illustrative. My local library has all series of the show.

I believe that in all areas of government, in any country, where there is a will, there is an exception, exemption, exclusion, waiver, implementation memorandum, or precedent decision that will allow for a variance of $50 out of $6900 (less than one percent) for a single year to prevent well meaning individuals from unintentionally breaking the law through no fault of their own.

I am considering putting some salient points into a letter to Acting Commissioner Kautter. Does anyone have additional thoughts to add?
Well, it seems that I should make acknowledgement that the IRS found a way to do the right thing here, eventually. Now to re-jigger my contributions again! (Good problem to have)
Understand that choosing an HDHP is very much a "red pill" approach. Most would rather pay higher premiums for a $20 copay per visit. They will think you weird for choosing an HSA.
IlliniDave
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by IlliniDave »

Well, I'm glad they put it back. Even though mine is done incrementally throughout the year by payroll deduction, we select the total contribution at benefits election time the prior year, and they make it a PITA to change on the fly (easy to add extra money above the deduction, not so easy to modify the deduction amount). Once again procrastination pays dividends. :D
Don't do something. Just stand there!
jehovasfitness
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by jehovasfitness »

It's almost like they penciled in changes at the last minute in the margins.
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gasdoc
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by gasdoc »

But with Saturna Capital, every transaction is a transaction fee. I think I'll leave it $50 short.

gasdoc
inbox788
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Re: HSA family max contribution lowered to $6850 for 2018

Post by inbox788 »

Edie wrote: Fri Apr 27, 2018 12:41 am :oops: https://www.forbes.com/sites/ashleaebel ... on-limits/ 6900 allowed... Again.
Humans vs. robots. Score one for the humans!
Determined
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Re: HSA family max contribution lowered to $6850 for 2018

Post by Determined »

inbox788 wrote: Fri Apr 27, 2018 1:13 pm
Edie wrote: Fri Apr 27, 2018 12:41 am :oops: https://www.forbes.com/sites/ashleaebel ... on-limits/ 6900 allowed... Again.
Humans vs. robots. Score one for the humans!
I find this ironic because our HR just sent out an email that it was reduced to $6850 yesterday! I will be forwarding her this, lol. We have to request all changes.
Last edited by Determined on Fri Apr 27, 2018 4:50 pm, edited 1 time in total.
FILR
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by FILR »

Last month I got the email from HR saying my deduction would change Today I just got an email from HR saying nevermind your deduction won't change. 😂🤣😂🤣
motorcyclesarecool
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by motorcyclesarecool »

Emily Litella for IRS Commissioner
https://m.youtube.com/watch?v=OjYoNL4g5Vg
Understand that choosing an HDHP is very much a "red pill" approach. Most would rather pay higher premiums for a $20 copay per visit. They will think you weird for choosing an HSA.
DavidC
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Re: HSA family max contribution lowered to $6850 for 2018

Post by DavidC »

Edie wrote: Fri Apr 27, 2018 12:41 am :oops: https://www.forbes.com/sites/ashleaebel ... on-limits/ 6900 allowed... Again.
Thanks for pointing that out. For anyone who doesn't want to go to Forbes' website, the IRS revenue ruling can be found here.
In true boglehead fashion my chief concern is saving enough to withstand 7 consecutive biblical plagues. - TheNightsToCome
Spedward
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by Spedward »

Unfortunately, I believe on a go forward basis, the downward inflationary adjustment applies going forward. They effectively slowed down the increase in contributions going forward.
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nps
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by nps »

Spedward wrote: Fri Apr 27, 2018 8:57 pm Unfortunately, I believe on a go forward basis, the downward inflationary adjustment applies going forward. They effectively slowed down the increase in contributions going forward.
Correct. They also slowed the upward adjustment of tax brackets, reducing protection against bracket creep. And unlike other parts of the law, this does not have a sunset provision.
TIAX
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by TIAX »

If there is no change in inflation (or not enough of a change), will the max go back down to $6850 in 2019?
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FiveK
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by FiveK »

TIAX wrote: Sat Apr 28, 2018 12:12 pm If there is no change in inflation (or not enough of a change), will the max go back down to $6850 in 2019?
May not have long to wait on that, given the "rediscovery" (see the IRS revenue ruling) that "section 223(g)(1)...requires annual inflation adjustments for HSAs to be published by June 1 of the preceding calendar year."
Spirit Rider
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by Spirit Rider »

TIAX wrote: Sat Apr 28, 2018 12:12 pm If there is no change in inflation (or not enough of a change), will the max go back down to $6850 in 2019?
Possibly, but I think it is more likely that it "goes up" to $6900 or more. The difference between the CPI-U and the C-CPI-U is fractions of a percent at these levels. There might have only been a difference of $10 between $6900 and $6850, say $6880 and $6870. One would round up and one down.

So lets say the C-CPI-U comes in at 2%, then $6870 * 1.02 $= $7007 rounded down to $7000.

In fact, the March CPI-U and the March C-CPI-U numbers have been released. If I did the calculations correctly, the rounding actually shows $7000 for 2019. The IRS should have the actual numbers any day now.
Atgard
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by Atgard »

YES! This was one instance where the "wait and see" approach paid dividends (I had put in the full $6,900 in January). I was hoping the IRS would do the right thing, what a hassle it was going to be for us, HSA administrators, and the IRS to haggle over that $50 and a bunch of $3 fines. Glad to have one less tax thing to worry about this year.

Thanks to everyone staying on top of it, and for updating the thread title to help people just seeing it.
MI_bogle
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by MI_bogle »

Ugh. Just got the email from my HSA provider... of course, this is about 5 weeks AFTER I changed my contribution via payroll

I am just going to leave it 50 bucks short, what a giant PITA.
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Darth Xanadu
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by Darth Xanadu »

MI_bogle wrote: Wed May 02, 2018 3:11 pm Ugh. Just got the email from my HSA provider... of course, this is about 5 weeks AFTER I changed my contribution via payroll

I am just going to leave it 50 bucks short, what a giant PITA.
Good idea, they will probably change back to $6,850 at the end of the summer. But then maybe back to $6,900 around Thanksgiving?
nolesrule
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by nolesrule »

Can we just put the $50 in via direct contribution instead of payroll deduction? I can live without the $1.18 reduction in Medicare taxes.

The HSA is through my wife's employer so I don't know if/when the limit will be changed again.
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FiveK
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by FiveK »

nolesrule wrote: Wed May 02, 2018 3:20 pm Can we just put the $50 in via direct contribution instead of payroll deduction?
Yes.

The $50 will go on line 2 of Form 8889, and the amount contributed by payroll deduction will go on line 9. The line 9 amount will have already been subtracted from wages before reaching W-2 box 1, and the $50 will be subtracted on Form 1040 line 25.
nolesrule
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by nolesrule »

FiveK wrote: Wed May 02, 2018 4:17 pm
nolesrule wrote: Wed May 02, 2018 3:20 pm Can we just put the $50 in via direct contribution instead of payroll deduction?
Yes.

The $50 will go on line 2 of Form 8889, and the amount contributed by payroll deduction will go on line 9. The line 9 amount will have already been subtracted from wages before reaching W-2 box 1, and the $50 will be subtracted on Form 1040 line 25.
Thanks. That's what I thought. Really, my point of unsurety was if the limit was conditional on having already contributed the limit, which is a rather silly conclusion to reach.
92irish
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Re: HSA family max contribution lowered to $6850 for 2018 [and changed to $6900 again]

Post by 92irish »

Now I am glad I procrastinated and did not do anything about my "over" contribution of $6,900.

Good grief.
Chicago60
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Re: HSA family max contribution lowered to $6850 for 2018

Post by Chicago60 »

Spirit Rider wrote: Wed Mar 07, 2018 8:05 pm
Chicago60 wrote: Wed Mar 07, 2018 7:43 pm I respectfully prefer my approach to yours.
Respectfully, read the thread for my posts and approach. I was just trying to help you avoid a larger cost than necessary.

My approach if there is a fee is to do nothing right now. Then next year when filing your tax return, simply pay the 6% excise tax ($50 x 6% = $3) and necessary tax filings and steps.
As it turns out, in light of the IRS position, your approach to "do nothing right now" and wait and see was the better one.
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