Health Savings Account (HSA) Contributions
Who can contribute?
Contributions to your HSA can be made by:
- You
- Your employer
- Your family members
- Any combination of the above
We recommend you discuss contributions made by someone other than your employer or family with your tax advisor, as other rules may apply.
Contributions to your HSA are not subject to federal income tax. This money is referred to as “pre-tax” dollars. Interest or investment earnings in the account have the potential to grow tax-deferred.
Making a contribution
You can contribute to your Principal HSA several ways:
- Direct deposit: Your employer can set up automatic deductions that are deposited into your HSA. Money is taken out of your paycheck before taxes, lowering your earnings subject to taxes.
- HSA deposit slip: Fill out an HSA deposit slip and submit it, along with the contribution to Principal Bank. You can make contributions for the current tax year until April 15 of the following year (the tax filing deadline for most filers).
- Postage-paid envelopes and deposit slips are available for deposits by calling an HSA specialist at 1.855.400.6620, 7 a.m. - 7 p.m. Central Time, Monday – Friday or you can request postage-paid envelopes online
Money in an Archer Medical Savings Account (MSA), HSA or individual retirement account (IRA) may be rolled over into your HSA.
Annual contribution limits
The maximum annual contribution allowed to your HSA is:
| Type of Coverage | 2011 Limits | 2012 Limits |
|---|---|---|
| Coverage for Self | $3,050 | $3,150 |
| Coverage for Family | $6,150 | $6,250 |
Regardless of when you enroll during the year, you can contribute the full amount for the year. However, failure to maintain eligibility for 12 months following the end of the calendar year will result in taxes and penalties.
Once you enroll in Medicare, no further HSA contributions can be made.
Catch-up contributions
If you are 55 or older, you may make additional annual “catch-up” contributions. The annual catch-up contribution allowed to your HSA is:
- 2009 and later: $1,000
You can begin making catch-up contributions anytime during the year you turn 55. However, failure to maintain eligibility for 12 months following the end of the calendar year will result in taxes and penalties.
Excess contributions
Contact the HSA Customer Contact Center at 1.855.400.6620 to request excess contributions be removed from your account.
This material is a summary of Health Savings Accounts. It is not a complete statement of the provisions or requirements of HSAs. It is intended to provide accurate and authoritative information in regard to the subject matter covered. The accuracy of the information is not guaranteed and is provided with the understanding that The Principal is not rendering legal, accounting, or tax advice. While this communication may be used to promote or market a transaction or an idea that is discussed in the publication, it is not a marketed opinion and may not be used to avoid penalties under the Internal Revenue Code. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, or accounting obligations and requirements. Custodial services for Health Savings Accounts offered by Principal Life Insurance Company. Bank products and services provided by Principal Bank, Member FDIC, Equal Housing Lender. HSA monies held in a Principal Bank account are FDIC insured. Principal Life and Principal Bank are members of the Principal Financial Group, Des Moines, IA 50392.
