Summary:
Veterans who are currently enrolled in a High Deductible Health Plans(HDHP) with or without employer Healthcare Savings Account (HSA) contributions can contribute through their employer or directly to the institution that is managing their HSA. If you are not enrolled in a high deductible plan, you cannot make contributions to an HSA. There are a few caveats listed below:
Detail:
If you have used the VA health care and received a "medical benefit" for anything but service related disabilities, you cannot contribute to the HSA. For more information on this you can visit this website
As of 2022, all HDHP allow for a maximum contribution of $3,650 per year for "self-only" plans with additional catchup of $1,000 for those older than 55. For family plans the amount is $7,300. Click here to see HSA contribution limits.
If you cancel your HDHP during the year, you can max out your contributions to your HSA based on the number of months you were active on your HDHP. You can make these contributions up to April 15th the following year. For example: I stop my HDHP in June after 6 months. At that time, my employer and I have only contributed $1,500 to the HSA on my self-only HDHP. If I am older than 55, my full year plan total would have been $4,650. Since I only had the plan for 6 months, I could only contribute a maximum of $2,325 for that year leaving another $825 I can contribute up till April 15th of the following year. If I am under 55, I can only contribute $325.
Conclusion:
You must have a high deductible plan to make HSA contributions in a tax year. If you have a medical benefit from the VA except for service related disabilities you cannot contribute to the HSA.
What is considered a "VA medical benefit"? Veterans need to confirm what is considered a medical benefit. Physicals, initial care appointments may or may not be considered a medical benefit.
