Can you contribute to HSA while on Social Security?
Asked by: Marques Kreiger | Last update: November 12, 2025Score: 4.1/5 (63 votes)
Do I have to stop HSA contributions 6 months before Social Security?
Stop making contributions to your HSA up to 6 months before applying for Medicare Part A only or Part A and Part B or starting your Social Security retirement benefits.
Can I contribute to an HSA if I take Social Security?
If you file for Social Security six months or more past full retirement age, you can get up to six months in back benefits, and therefore would need to stop contributing to your HSA six months prior to your Medicare start date.
What disqualifies you from contributing to an HSA?
If you can receive benefits before that deductible is met, you aren't an eligible individual. Other employee health plans. An employee covered by an HDHP and a health FSA or an HRA that pays or reimburses qualified medical expenses can't generally make contributions to an HSA. FSAs and HRAs are discussed later.
What is the penalty for contributing to an HSA while on Medicare?
If you or any other authorized party, like an employer, make excess contributions to your HSA once you have Medicare, you can be charged a 6% Internal Revenue Service tax penalty on those funds and any interest they accrue until the funds are removed from your account.
Can You Contribute to an HSA in Retirement?
What happens if I contribute to my HSA after age 65?
If you are not enrolled in Medicare and are otherwise HSA eligible, you can continue to contribute to an HSA after age 65. You are also allowed to contribute the $1,000 catch-up. If you signed up for Medicare Part A and now want to decline it, you can do so by contacting the Social Security Administration.
At what point should I stop contributing to my HSA?
Once you turn 65, you can use the money in your HSA for anything you want. If you don't use it for qualified medical expenses, it counts as income when you file your taxes. Six months before you retire or get Medicare benefits, you must stop contributing to your HSA.
Can I contribute to my HSA in the year I start Medicare?
Due to IRS rules, once you enroll in Medicare you are no longer allowed to contribute to an HSA. BenefitWallet® created the following information to determine when you should cease contributing to your HSA and how you should manage and use the account going forward.
What is the downside of an HSA?
Drawbacks of HSAs include tax penalties for nonmedical expenses before age 65, and contributions made to the HSA within six months of applying for Social Security benefits may be subject to penalties. HSAs have fewer limitations and more tax advantages than flexible spending accounts (FSAs).
What is the 12 month rule for HSA?
It means you must remain eligible for the HSA until December 31 of the following year. The only exceptions are death or disability. If you violate the testing period requirement, your ineligible contributions become taxable income.
Can a retired person put money in an HSA?
You can contribute to a health savings account after you retire, so long as you are not enrolled in Medicare. If you are enrolled in Medicare you cannot contribute to a health savings account, but there are other ways of saving for expected and unexpected healthcare costs.
At what age is Social Security no longer taxed?
Social Security income can be taxable no matter how old you are. It all depends on whether your total combined income exceeds a certain level set for your filing status. You may have heard that Social Security income is not taxed after age 70; this is false.
Is it better to take Social Security at 62 or 67?
You can start receiving your Social Security retirement benefits as early as age 62. However, you are entitled to full benefits only when you reach your full retirement age. If you delay taking your benefits from your full retirement age up to age 70, your benefit amount will increase.
Can you collect Social Security and still contribute to an HSA?
As discussed above, you can't have Medicare Part A and open or contribute to an HSA. However, you can't opt out of Part A while collecting your Social Security retirement benefits either. If you want to contribute to your HSA, you must delay your Social Security payments so you can decline Medicare Part A.
Can I use my HSA to pay for Medicare premiums?
The good news: You can keep using your HSA funds
You can even use your HSA to pay for some Medicare expenses including your Medicare Part B, Part D and Medicare Advantage plan premiums, deductibles, copays and coinsurance.
How much should I have in my HSA at retirement?
The amount of money you should have in your HSA during retirement depends on your healthcare needs and circumstances. According to the Fidelity Retiree Health Care Cost Estimate, a single person who is age 65 in 2023 should aim to have about $157,000 saved (after tax) for healthcare expenses during retirement.
Who should not do an HSA?
HSAs might not make sense if you have some type of chronic medical condition. In that case, you're probably better served by traditional health plans. HSAs might also not be a good idea if you know you will be needing expensive medical care in the near future.
Do I ever lose my HSA money?
Myth #2: If I don't spend all my funds this year, I lose it. Reality: HSA funds never expire. When it comes to the HSA, there's no use-it-or-lose-it rule. Unlike Flexible Spending Account (FSA) funds, you keep your HSA dollars forever, even if you change employers, health plans, or retire.
Can HSA be used for dental?
Yes, you can use a health savings account (HSA) or flexible spending account (FSA) for dental expenses.
At what age can you no longer contribute to an HSA?
There is a six-month lookback period (but not before the month of reaching age 65) when enrolling in Medicare after age 65, so a best practice is for workers to stop contributing to their HSA six months before the month they apply for Medicare to avoid penalties.
Who cannot contribute to an HSA?
You can't contribute to an HSA if you have Medicare coverage, or a plan that pays its share of a covered service without you having to pay deductibles or copayments first (called “first dollar coverage”).
What is the penalty for HSA after 65?
Your HSA as a retirement account
If you withdraw money from your HSA for something other than qualified medical expenses before you turn 65, you have to pay income tax plus a 20% penalty. But after you turn 65, that 20% penalty no longer applies and you only pay income tax!
What is the 6 month rule for HSA?
Under current regulations, individuals who apply for Medicare Part A or Part B after reaching age 65 are automatically given six months of retroactive health coverage, which invalidates their ability to make or receive HSA contributions for any of those months they were deemed to be covered.
What happens to HSA when you retire?
What happens to my HSA if I change health plans, terminate employment, or retire? The money in the HSA belongs to you. You can continue to use the money in your HSA to pay for qualified medical expenses but you can no longer make contributions to the account unless you are enrolled in another HSA-eligible HDHP.
Do you have to stop contributing to HSA 6 months before Medicare?
Since you will be older than 65 when applying for Medicare, you will need to stop HSA contributions 6 months before applying. Behind the scenes, Medicare Part A has a 6-month retroactive start date. And therefore, contributions to an HSA become ineligible six months before filing the application.