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HSA excess contribution

KyleB_1

After inputting my HSA information in FreeTaxUSA, I get a message that (roughly $950) of my HSA contributions are considered excess contributions. I was told that if you are over the age of 55, you can contribute an extra $1000 a year…which I did. The system doesn't seem to take my age into account. It seems to adjust what my return will be…subject to additional tax. I can't think of a way to get around this without changing the HSA contribution amount that my tax documents show (which I don't want to do). Is there a workaround for this or am I missing something?

Thank you.

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Comments

MatthewD

Hello KyleB_1,

Thank you for reporting this. This feature has been thoroughly tested and I have personally used it without a problem. The first thing I suggest you do is check your birth year on the Taxpayer information page. Make sure your birthyear is correct.

If you still see the problem, please contact Customer Support while logged into your account.

KyleB_1

Hello Matthew,

You are correct. Somehow, my birthdate was completely off. Thanks for pointing me in the right direction!

Take care!

Kyle

MickeyB01

https://community.freetaxusa.com/discussion/comment/4237#Comment_4237

My birthdate is correct and I am over 55 and I am getting the same error for tax year 2025 that I have made an excess contribution. The only way to get the software to work is to reduce my husband's contribution. What gives? How can this get fixed?

MatthewD

Hi MickeyB01,

Keep in mind there can be various reasons which can trigger an excess contribution. Generally, it has to do with income, and if you participate in an employer retirement plan. We would need more information to determine the reason.

I suggest you contact Customer Support while signed into your account. Someone can help you out to determine the reason for the excess contribution.

WilliamsNJ

https://community.freetaxusa.com/discussion/comment/6621#Comment_6621

I'm facing this exact same problem. Over 55, my husband and I contributed 10,550 in 2025 between our two HSA accounts and FreeTaxUSA is giving an error that we could only contribute 8,550. I'm stuck. Birthdates are correct in system. How did you resolve this?

MatthewD

Hi WilliamNJ,

Thank you for participating in the community.

This can be a complex issue and without all the details, practically impossible to answer in our community. You obviously know you can contribute an addition $1,000 to each person over 55 years.

When you are entering your HSA contributions, make sure you correctly allocate your limits on the "How should we split the HSA contribution limit?" page. Also, you can contribute to a Health Savings Account (HSA) even if you do not have wages, employment income, or are retired, as long as you are covered by an HSA-qualified High-Deductible Health Plan (HDHP).

I suggest you contact Customer Support so you can have someone review your account and help with a solution.

ScottDT1

https://community.freetaxusa.com/discussion/comment/6916#Comment_6916

I had the same problem. The only thing that worked was to divide the $10,550 equally($5,275) between the two of us during the interview part of the section and not wait for the page that asks you divide the total between the two of you . If done this way, that last allocation page didn't appear. I suspect this is a bug in their software.

_SP

This 2025 tax filing and I still see same issue. I turned over 55 in this tax year(2025). Me with Individual and my wife with Family HDHP Contributed over 8550. And FreeTax tells us to take excess contribution penalty for rest of the amount. Can someone help please? My DoBs better be correct or else IRS would have been after me long ago

MatthewD

Hello _SP,

Thank you for your post and information. While it is okay for spouses to both have an HSA, you cannot exceed the maximum family contribution limit. The IRS says, "The rules for married people apply only if both spouses are eligible individuals. If either spouse has family HDHP coverage, the family contribution limit applies; both spouses are treated as having family HDHP coverage."

For details see: "Rules for married people" in publication 969: https://www.irs.gov/publications/p969#en_US_2025_publink1000204059

From what you have explained, your combined HSA contribution for 2025 has an excess amount. Work with your HSA administrator to make a correction. Otherwise, a penalty will be imposed. When the excess is reported as withdrawn the amount will be added as taxable income.

_SP

https://community.freetaxusa.com/discussion/comment/7610#Comment_7610

Hi MatthewD,

I am over 55yr and shouldn't I be getting to contribute additional $1000 on top of $8550?

_SP

Here is a link from fidelity

https://www.fidelity.com/learning-center/smart-money/hsa-contribution-limits

_SP

Here is the link with example if that makes sense. Again Taxes and finances are not my primary languages

https://apps.irs.gov/app/vita/content/17s/37_06_020.jsp#:~:text=If%20both%20spouses%20are%2055,up%20contribution%20for%20each%20spouse.

kiarab

Hello _SP,

You are right, if you are 55 or older, you should be able contribute an extra 1,000. Based on what you said, I think something is probably entered incorrectly in the HSA contribution limit split screen where you allocate the family limit of 8,550 between the two spouses. The extra 1,000 only apply to you (if you are the only spouse that is 55 or older), but you would not include that in the allocation of the 8,550 limit.

What I would recommend is that you allocate enough to the spouse under 55 to cover the amount of contributions they had and apply the rest to the spouse that is 55 or older. The extra thousand for the 55 or older spouse should help them not have an excess even if the allocated amount of the 8,550 is less than what they contributed to their HSA.

If you are still having problems, I would recommend that you contact customer support so they can view your account and see where the error lies.

_SP

Thanks so much Kiarab! I am pretty sure I tried those steps. But I will try what you mentioned with clear conscious mind and post a reply. Appreciate it!

_SP

That seems to work. Thank you so much Kiarab!