What is the contribution limit if an individual switches HDHP coverage during the year?
HSA eligibility is determined on the first of each month. If an HSA owner changes HDHP coverage from self-only to family or family to self-only, she can add up the monthly limit for each month she was covered to determine her annual contribution limit, or she can determine her contribution limit as if she was covered by the same HDHP coverage for the entire year as the coverage held on December 1. With this rule, the HSA owner may increase, but does not have to decrease the contribution limit. For example if an HSA owner has self-only coverage throughout 2021, but switches to family coverage on November 1, 2021, and has family coverage through December 31, 2021, the HSA owner’s contribution limit is the family coverage contribution limit of $7,200 for 2021.