Skip to main content
    Skip to main content
    TaxPayers.net logoTaxPayers.net

    HSA Last-Month Rule Calculator

    Build the ordinary monthly worksheet, then compare it with the December-coverage annual alternative and quantify any contribution that carries the testing-period risk.

    Updated Reviewed for 2026 & 2027 HSA limitsIRS-sourced

    Can December HSA eligibility unlock the full annual limit?

    Yes—if you are HSA-eligible on December 1, the last-month rule compares a full annual limit at your December coverage level with the ordinary monthly worksheet, and the higher amount controls. Contributions allowed only by that alternative carry a testing period through December 31 of the next year and generally face income inclusion plus a 10% additional tax if eligibility fails.

    • Ordinary method: one-twelfth of the annual limit for each eligible month
    • The higher of the monthly worksheet or December annual alternative controls
    • Death and disability are statutory exceptions to recapture

    Source:IRC §223(b)(8) and IRS Publication 969

    Coverage on the first day of each month

    Choose “none” for a month you were not HSA-eligible. This tool does not determine whether your health coverage is HSA-qualified.

    Contributions and elections

    $
    $
    $

    Questions people miss

    How is a partial-year HSA contribution limit calculated?

    The ordinary limit is generally one-twelfth of the annual limit for each month you were HSA-eligible on the first day of that month. The coverage level for that month—self-only or family—controls that month's slice.

    What is the HSA last-month rule?

    If you are HSA-eligible on December 1, the last-month rule adds a full-year limit based on December coverage as an alternative to the ordinary monthly worksheet; the higher result controls. Contributions made only because of that alternative carry a testing period through December 31 of the following year unless you die or become disabled.

    What happens if I fail the HSA testing period?

    The contribution that was allowed only because of the last-month rule is included in income for the year eligibility first fails and is generally subject to a 10% additional tax. Form 8889 Part III reports the recapture.

    Do employer HSA contributions count toward the limit?

    Yes. Employer and employee HSA contributions share the same annual limit. Archer MSA contributions and qualified HSA funding distributions can also reduce available HSA contribution room.

    Continue your HSA planning

    Annual HSA CalculatorRetirement Contribution Calculator2026 HSA Eligibility GuideOfficial 2027 HSA Limits

    Sources & References

    Primary references used for this content

    IRS Pub. 969

    IRS Publication 969 — last-month rule and testing period

    Monthly limits, last-month rule, testing period, and 10% additional tax

    View on irs.gov

    IRC §223

    IRC §223(b)(8) — statutory last-month rule

    Statutory monthly limitation and last-month-rule recapture

    View on law.cornell.edu

    Form 8889

    IRS Instructions for Form 8889 — Part III recapture

    Line 3 limitation worksheet and Part III reporting

    View on irs.gov

    Rev. Proc. 2026-24

    Rev. Proc. 2026-24 — official 2027 HSA limits

    Official 2027 HSA limits

    View on irs.gov

    ✓Rules checked September 6, 2026 against IRC §223, IRS Publication 969, Form 8889 instructions, and Rev. Proc. 2026-24.

    Disclaimer: This calculator provides estimates for educational purposes only. Not tax, legal, or financial advice. Results may vary based on your specific circumstances. Consult a qualified CPA or tax professional for personalized guidance.