What if someone is only eligible for a portion of the year?

If an HSA owner is HSA-eligible for only a portion of the year, he may make a full-year contribution if he remains HSA-eligible throughout a 13-month “testing period.” The testing period runs from the first day of the last month of the initial eligibility year through the end of the 12-month period following that month.

 

If HSA owners fail to maintain eligibility for the entire testing period, they must prorate the contribution limit for the number of months they were eligible. HSA owners must include ineligible contributions in gross income and pay a 10 percent testing period failure penalty tax on the ineligible amount.