Annual contribution limits are set by the IRS and change each year
The amount you can put into a health savings account depends on the type of health insurance plan you have and whether you cover yourself alone or your family. The IRS sets these limits annually, and they increase most years to account for inflation. For 2024, the limit is $4,150 for individual coverage and $8,300 for family coverage. For 2025, those limits rise to $4,300 and $8,550.
These are the maximum amounts you can contribute across all HSAs you own in a single year. If you have more than one HSA (which is rare but possible), your total contributions to all of them combined cannot exceed the limit. The IRS enforces this limit, and contributing more than allowed can result in taxes and penalties on the excess amount.
Your employer may contribute to your HSA as well. Employer contributions count toward your annual limit, not in addition to it. If your employer puts $2,000 into your account, you can only add $2,150 more (in 2024) if you have individual coverage.
Key Takeaways
- The 2024 limit is $4,150 for individual coverage and $8,300 for family coverage; 2025 limits are $4,300 and $8,550.
- Employer contributions count toward your limit, so you cannot contribute the full amount if your employer has already contributed.
- You can only contribute if you are enrolled in a high-deductible health plan (HDHP) and have no other health coverage besides certain exceptions.
- Contributions you do not use in a given year roll over and remain in your account indefinitely with no "use it or lose it" deadline.
- If you turn 55, you can contribute an additional $1,000 per year as a catch-up contribution, even if you are still working.
Who can contribute and when contributions are allowed
You can only contribute to an HSA if you are enrolled in a high-deductible health plan (HDHP) for the entire month. If you drop your HDHP coverage or switch to a different type of plan mid-year, you cannot contribute for the months you are not covered. Some employers allow you to contribute only during open enrollment or when you first become may be able to access; others allow contributions throughout the year.
Certain types of coverage disqualify you from contributing, even if you have an HDHP. If you are covered by Medicare, Medicaid, the Veterans Administration, or a spouse's non-HDHP plan, you cannot contribute to an HSA. Coverage through a parent's plan (if you are under 26) also blocks contributions. Dental and vision coverage alone do not disqualify you.
Your employer can contribute on your behalf, and this is common when an employer offers an HSA as part of the benefits package. You can also make contributions yourself through payroll deduction (which reduces your taxable income) or by depositing money directly into the account after taxes and then deducting it on your tax return.
Catch-up contributions if you are 55 or older
Once you turn 55, you become may be able to access for an additional catch-up contribution of $1,000 per year, on top of the standard limit. This applies whether you are still working or retired. If you have family coverage, only the person who is 55 or older can make the catch-up contribution; a spouse who is younger cannot make one unless they also turn 55.
You can continue making catch-up contributions for as long as you remain enrolled in an HDHP. If you drop your HDHP coverage, you lose the right to make catch-up contributions starting the month after coverage ends. If you later re-enroll in an HDHP, you regain the right to make catch-up contributions once you turn 55 again (or if you are already 55).
What happens to money you do not spend in a year
Unlike a flexible spending account (FSA), an HSA has no "use it or lose it" rule. Any money you contribute but do not spend in a given year stays in the account indefinitely. You can accumulate thousands of dollars over time and use them years later for may have access to medical expenses. This makes an HSA a long-term savings tool, not just a way to pay for immediate healthcare costs.
The money in your HSA typically earns interest or can be invested in mutual funds, depending on your account provider. Some HSA providers offer investment options similar to a 401(k), allowing your balance to grow beyond what you contribute. You only pay taxes on the earnings if you withdraw money for non-medical expenses.
Penalties for over-contributing
If you contribute more than the annual limit, the excess amount is subject to a 6% excise tax each year it remains in the account. The excess is also added to your taxable income for that year. For example, if the 2024 limit is $4,150 and you contribute $5,000, the $850 excess is taxed at 6% ($51) immediately, and you owe income tax on that $850 as well.
To correct an over-contribution, you can withdraw the excess amount plus any earnings on it before the tax filing deadline (usually April 15 of the following year). If you withdraw the excess in time, you avoid the 6% penalty, though you still owe income tax on any earnings. Your HSA provider can help you calculate the earnings portion.
If you contributed too much because your employer made an error, contact your employer's benefits department immediately. They may be able to correct the contribution before the year ends or help you file an amended return.
How to track your contributions and stay within the limit
Your HSA provider sends you an annual statement showing all contributions made to your account during the year, including employer contributions. Keep this statement for your tax records. If you contribute through payroll deduction, your employer withholds the amount and reports it on your W-2 form as a pre-tax deduction.
If you make contributions after taxes (by depositing money directly into the account), you must deduct them on your tax return using Form 8889 to avoid paying taxes twice. Your HSA provider will send you a Form 5498-SA each year showing the total contributions made to your account; use this to complete Form 8889.
If you have multiple HSAs or switch providers during the year, add up all contributions across all accounts to ensure you do not exceed the annual limit. Some people accidentally over-contribute when they have accounts at two different banks or when they change employers mid-year.
Contribution limits for people who enroll mid-year
If you enroll in an HDHP partway through the year, you can still contribute the full annual limit for that year, as long as you remain enrolled through December 31. This is called the last-month rule. For example, if you enroll in an HDHP in September 2024, you can contribute the full $4,150 (for individual coverage) even though you were only covered for four months.
The catch: if you use the last-month rule and then drop your HDHP coverage before December 31 of the following year, you must withdraw the excess contributions that you would not have been allowed to make if you had only been covered for the months you actually were enrolled. This prevents people from using the rule as a loophole to over-contribute.
Frequently Asked Questions
Can I contribute to an HSA if my employer already contributed the maximum?
No. Employer contributions count toward your annual limit. If your employer contributed $3,000 and the limit is $4,150, you can only add $1,150 yourself. You cannot exceed the total limit no matter who contributes the money.
What if I leave my job mid-year? Can I still contribute for the full year?
Only if you remain enrolled in an HDHP through December 31. If you drop HDHP coverage when you leave your job, you can only contribute for the months you were actually covered. If you enroll in a new HDHP with a new employer before the year ends, you can continue contributing up to the annual limit.
Do I have to contribute the maximum amount every year?
No. You can contribute any amount up to the limit, or nothing at all. There is no minimum contribution required. However, you must be enrolled in an HDHP to contribute at all, even if you only contribute $100.
Can my spouse and I each contribute the family coverage limit?
No. The family coverage limit applies to the entire family, not per person. If you have family coverage, you and your spouse combined can contribute up to $8,300 (in 2024), not $8,300 each. You decide together how to split the contribution.
What happens to my HSA contributions if I switch to Medicare?
You can no longer contribute once you enroll in Medicare, because Medicare coverage disqualifies you from HSA contributions. However, you keep the money already in your account and can continue withdrawing it for may have access to medical expenses for the rest of your life with no time limit.