HSA for Spouse

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Topic Author
ginstwin
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HSA for Spouse

Post by ginstwin »

I currently have an HSA for my wife (50) and I (64). I have contributed annually the max allowed .

I qualify for Medicare in 2021 and therefore cannot contribute to an HSA . My wife will have 15 years before she is eligible for Medicare. I want to contribute into an HSA for her. Does she need to open a new HSA just for her or can we use our existing HSA for her contributions ? .
livesoft
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Re: HSA for Spouse

Post by livesoft »

It will depend on her health insurance plan, won't it? When you go on medicare, what happens to her health insurance? Presumably any health insurance that she gets will not have your name on it, so if she gets her own HDHP, then she will need to have her own HSA, right?
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mptfan
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Re: HSA for Spouse

Post by mptfan »

I'm not married, so maybe this is a gap in my knowledge...is there such a thing as a "joint HSA" for married couples? I always assumed that HSA accounts must be individual accounts, just like IRA accounts must be individual accounts.
Topic Author
ginstwin
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Re: HSA for Spouse

Post by ginstwin »

livesoft wrote: Thu Sep 03, 2020 3:47 pm It will depend on her health insurance plan, won't it? When you go on medicare, what happens to her health insurance? Presumably any health insurance that she gets will not have your name on it, so if she gets her own HDHP, then she will need to have her own HSA, right?
She will have her own health insurance. So it looks like she will need her own HSA account. Thanks
Topic Author
ginstwin
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Re: HSA for Spouse

Post by ginstwin »

mptfan wrote: Thu Sep 03, 2020 3:52 pm I'm not married, so maybe this is a gap in my knowledge...is there such a thing as a "joint HSA" for married couples? I always assumed that HSA accounts must be individual accounts, just like IRA accounts must be individual accounts.
Maybe I am confused. An individual limit is $3550 (plus $1000 if over 55) or $7100 (plus $1000) for family coverage. I have been contributing the full family amount into an HSA . I haven’t used it but i understood that i could use that HSA for health costs for either of us?
mptfan
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Re: HSA for Spouse

Post by mptfan »

ginstwin wrote: Thu Sep 03, 2020 3:57 pm
mptfan wrote: Thu Sep 03, 2020 3:52 pm I'm not married, so maybe this is a gap in my knowledge...is there such a thing as a "joint HSA" for married couples? I always assumed that HSA accounts must be individual accounts, just like IRA accounts must be individual accounts.
Maybe I am confused. An individual limit is $3550 (plus $1000 if over 55) or $7100 (plus $1000) for family coverage. I have been contributing the full family amount into an HSA . I haven’t used it but i understood that i could use that HSA for health costs for either of us?
I think you are correct that you may contribute up to $7,100 for family coverage for both of you, but you are still contributing to your individual HSA, not a "joint HSA," to my knowledge there is no such thing as a joint HSA. Maybe my understanding is not correct, but I think that you can contribute up to the family maximum to your individual HSA if you qualify for the family limit, but it's still an individual HSA.
Last edited by mptfan on Thu Sep 03, 2020 4:03 pm, edited 1 time in total.
ChrisC
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Re: HSA for Spouse

Post by ChrisC »

livesoft wrote: Thu Sep 03, 2020 3:47 pm It will depend on her health insurance plan, won't it? When you go on medicare, what happens to her health insurance? Presumably any health insurance that she gets will not have your name on it, so if she gets her own HDHP, then she will need to have her own HSA, right?
I believe she can obtain a family HDHP, which also covers the OP, and she could make family HSA contributions into her own HSA, irrespective of whether the OP is covered by Medicare -- the OP cannot make any contributions into his HSA. I did this myself when my wife went on Medicare and I was still not eligible for Medicare -- I continued to make family HSA (as well as catch-up) contributions to my HSA, while under my family HDHP coverage. Medicare became primary insurance for my wife, with the family HDHP as back-up.
Topic Author
ginstwin
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Re: HSA for Spouse

Post by ginstwin »

mptfan wrote: Thu Sep 03, 2020 4:01 pm
ginstwin wrote: Thu Sep 03, 2020 3:57 pm
mptfan wrote: Thu Sep 03, 2020 3:52 pm I'm not married, so maybe this is a gap in my knowledge...is there such a thing as a "joint HSA" for married couples? I always assumed that HSA accounts must be individual accounts, just like IRA accounts must be individual accounts.
Maybe I am confused. An individual limit is $3550 (plus $1000 if over 55) or $7100 (plus $1000) for family coverage. I have been contributing the full family amount into an HSA . I haven’t used it but i understood that i could use that HSA for health costs for either of us?
I think you are correct that you may contribute up to $7,100 for family coverage for both of you, but you are still contributing to your individual HSA, not a "joint HSA," to my knowledge there is no such thing as a joint HSA.
As I understand it I can use the current HSA to pay health related costs for either of us ? Is that correct? Thanks
mptfan
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Re: HSA for Spouse

Post by mptfan »

ChrisC wrote: Thu Sep 03, 2020 4:02 pm I believe she can obtain a family HDHP, which also covers the OP, and she could make family HSA contributions into her own HSA, irrespective of whether the OP is covered by Medicare -- the OP cannot make any contributions into his HSA.
Based on my understanding this is the correct answer.
mptfan
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Re: HSA for Spouse

Post by mptfan »

ginstwin wrote: Thu Sep 03, 2020 4:04 pm As I understand it I can use the current HSA to pay health related costs for either of us ? Is that correct? Thanks
I am not an expert in this area, and I stand to be corrected on this, but I believe that you can use your HSA to pay for medical expenses for you or your spouse.
Topic Author
ginstwin
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Re: HSA for Spouse

Post by ginstwin »

mptfan wrote: Thu Sep 03, 2020 4:06 pm
ginstwin wrote: Thu Sep 03, 2020 4:04 pm As I understand it I can use the current HSA to pay health related costs for either of us ? Is that correct? Thanks
I am not an expert in this area, and I stand to be corrected on this, but I believe that you can use your HSA to pay for medical expenses for you or your spouse.
Thanks MPTFan .
Topic Author
ginstwin
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Re: HSA for Spouse

Post by ginstwin »

ChrisC wrote: Thu Sep 03, 2020 4:02 pm
livesoft wrote: Thu Sep 03, 2020 3:47 pm It will depend on her health insurance plan, won't it? When you go on medicare, what happens to her health insurance? Presumably any health insurance that she gets will not have your name on it, so if she gets her own HDHP, then she will need to have her own HSA, right?
I believe she can obtain a family HDHP, which also covers the OP, and she could make family HSA contributions into her own HSA, irrespective of whether the OP is covered by Medicare -- the OP cannot make any contributions into his HSA. I did this myself when my wife went on Medicare and I was still not eligible for Medicare -- I continued to make family HSA (as well as catch-up) contributions to my HSA, while under my family HDHP coverage. Medicare became primary insurance for my wife, with the family HDHP as back-up.
So in our case if she has her own HDHP (which she will) will she be able to contribute the full family HSA contribution of $7100 into her own HSA . It sounds like she will be able to.
livesoft
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Re: HSA for Spouse

Post by livesoft »

ginstwin wrote: Thu Sep 03, 2020 4:10 pm So in our case if she has her own HDHP (which she will) will she be able to contribute the full family HSA contribution of $7100 into her own HSA . It sounds like she will be able to.
"sounds like" is something that sounds dicey without a citation from an IRS document. I would want to have something found at irs.gov that confirms this.
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Topic Author
ginstwin
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Re: HSA for Spouse

Post by ginstwin »

“In order to contribute the maximum family contribution limit, you must have family coverage with an HDHP. If your spouse enrolls in Medicare and this changes your HDHP coverage to single, this will affect your yearly contribution limit“

That makes it clear . If her HDHP policy only covers herself and I am on Medicare the $3500 limit applies. I really appreciate the help.
ChrisC
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Re: HSA for Spouse

Post by ChrisC »

livesoft wrote: Thu Sep 03, 2020 4:15 pm
ginstwin wrote: Thu Sep 03, 2020 4:10 pm So in our case if she has her own HDHP (which she will) will she be able to contribute the full family HSA contribution of $7100 into her own HSA . It sounds like she will be able to.
"sounds like" is something that sounds dicey without a citation from an IRS document. I would want to have something found at irs.gov that confirms this.
I'm sure someone like Spirit Rider will weigh in with an appropriate citation to the IRS literature. But I've had famiy HDHP coverage, well into the years my wife was on Medicare, and I made family HSA contributions into my own HSA (before and after my wife went on Medicare). She just stopped making any catch-up contributions into her own HSA account once she went on Medicare. Sounds like OP's wife can make family HSA contributions into her HSA if she obtains a family HDHP.
TropikThunder
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Re: HSA for Spouse

Post by TropikThunder »

ginstwin wrote: Thu Sep 03, 2020 4:27 pm “In order to contribute the maximum family contribution limit, you must have family coverage with an HDHP. If your spouse enrolls in Medicare and this changes your HDHP coverage to single, this will affect your yearly contribution limit“

That makes it clear . If her HDHP policy only covers herself and I am on Medicare the $3500 limit applies. I really appreciate the help.
There's a couple different considerations here. The first is whether one is an eligible individual, and the second is what an eligible individual's contribution limit is. From your OP it looks like currently, you have HSA-eligible Family HDHP coverage and have been making the family contribution to your HSA. So you are currently (1) an eligible individual (you have HSA-eligible HDHP coverage, and no other coverage) and (2) you can contribute to the family limit (plus the >over 55 catch up amount).
Qualifying for an HSA
To be an eligible individual and qualify for an HSA, you
must meet the following requirements.
• You are covered under a high deductible health plan
(HDHP), described later, on the first day of the month.
• You have no other health coverage except what is
permitted under Other health coverage, later.
• You aren’t enrolled in Medicare.
• You can’t be claimed as a dependent on someone
else’s 2019 tax return.
When you switch to Medicare next year, you will no longer be an eligible individual, and will no longer be able to contribute to your HSA. But when your wife switches to her own insurance, she will be an eligible individual IF her new coverage is an HSA-eligible HDHP plan and she satisfies the remaining eligibility requirements. If she is eligible, then she can contribute to her HSA (there are no joint HSA's).
Contributions to an HSA
Any eligible individual can contribute to an HSA. For an employee’s HSA, the employee, the employee’s employer, or both may contribute to the employee’s HSA in the same year. For an HSA established by a self-employed (or unemployed) individual, the individual can contribute. Family members or any other person may also make contributions on behalf of an eligible individual.
(emphasis added)
So you can contribute to her HSA on her behalf, but it will still be her HSA (if it's a work-based plan she should consider using payroll deduction to save FICA taxes).

How much she can contribute will depend on what kind of coverage she has. There's no rule against having multiple health insurance policies, so it's entirely possible that your wife enrolls in a Family HDHP and would thus be eligible for the family contribution limit. Your extra coverage that makes you ineligible does not affect her eligibility.
Limit on Contributions
The amount you or any other person can contribute to
your HSA depends on the type of HDHP coverage you
have, your age, the date you become an eligible individual, and the date you cease to be an eligible individual.
For 2019, if you have self-only HDHP coverage, you can
contribute up to $3,500. If you have family HDHP coverage, you can contribute up to $7,000.
(emphasis obsessively added)
Note the contribution limit does not depend on what kind of coverage the spouse or dependents have, only on what kind of coverage the eligible individual has. So if she switches to HSA-eligible Family HDHP coverage next year, she can contribute up to the family limit (pro-rated to the month her coverage starts, ignoring the last-month rule for simplicity).

All quotes are from IRS Pub 969
https://www.irs.gov/pub/irs-pdf/p969.pdf
TropikThunder
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Re: HSA for Spouse

Post by TropikThunder »

ChrisC wrote: Thu Sep 03, 2020 4:39 pm
livesoft wrote: Thu Sep 03, 2020 4:15 pm
ginstwin wrote: Thu Sep 03, 2020 4:10 pm So in our case if she has her own HDHP (which she will) will she be able to contribute the full family HSA contribution of $7100 into her own HSA . It sounds like she will be able to.
"sounds like" is something that sounds dicey without a citation from an IRS document. I would want to have something found at irs.gov that confirms this.
I'm sure someone like Spirit Rider will weigh in with an appropriate citation to the IRS literature. But I've had famiy HDHP coverage, well into the years my wife was on Medicare, and I made family HSA contributions into my own HSA (before and after my wife went on Medicare). She just stopped making any catch-up contributions into her own HSA account once she went on Medicare. Sounds like OP's wife can make family HSA contributions into her HSA if she obtains a family HDHP.
+1 I used more words to say the same thing. :P
Topic Author
ginstwin
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Re: HSA for Spouse

Post by ginstwin »

TropikThunder - Thank you so much for such a detailed response . It really is very helpful. Neither of us have insurance through employment so my thinking was that when I qualify for medicare my wife will enroll in her own HDHP plan which would not cover me. We are currently insured privately under a family plan.

I apologise for not fully understanding the complexities of medical insurance here in the USA. My wife and I are retired British Citizens (we recently became naturalized US Citizens).

I thought the best procedure would be literally changing plans once I reached 65 and she then would begin her own . It looks like I have more homework to do !
Lalamimi
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Re: HSA for Spouse

Post by Lalamimi »

You can contribute up until the month you turn 65 and start Medicare, don't forget. Just divide $3500 plus the over 55 amount for yourself, divide by 12, and contribute the amount times the number of months you are 64.
Topic Author
ginstwin
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Re: HSA for Spouse

Post by ginstwin »

Thanks LalaMimi. I will definitely do that .
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