An employee is eligible to set up an HSA if they satisfy all federal requirements, such as participating in a High Deductible Health Plan (HDHP).
You're responsible for determining an employee's eligibility and annual maximum for HSA contributions. We do not automatically limit or enforce an annual maximum for you, because plans vary widely. The maximum total annual contribution from you and the employee is their HSA plan deductible or the current IRS limit (whichever is lower). Consult your tax advisor, accountant, or insurance provider for more information.
- For individual coverage, the maximum annual HSA contribution is $3,350 for 2016 and $3,400 for 2017.
- For family coverage, the maximum annual HSA contribution is $6,750 for 2016 and 2017.
If the employee was eligible on the first day of the last month of the taxable year (December 1 for most taxpayers), then he is allowed the full annual contribution (plus catch-up contribution, if 55 or older by year end), regardless of the number of months he was eligible during the year.
HSA holders 55 and older can save $4,350 for an individual for 2016 and $4,400 for 2017 and $7,750 for a family in 2016 and 2017.