Leaderboard

You are not subject to the rules for married people. Therefore, your combined HSA contributions are not limited to the HSA maximum family contribution limit. So yes, your daughter's finance can make the HSA maximum family contribution limit, because they have self+1 coverage and she can make the HSA maximum self-only contribution limit. However, only your daughter can make tax-free distributions for qualified medical expenses for their child and they can not do so for each other's qualified medical expenses. An HSA can only be used to reimburse the the qualified medical expenses of themselves, their spouse and and their dependents. The key point to remember is that HSA contribution rules, HSA distribution rules and income tax treatment of dependents can all vary.

Taxpayer?

At this point I am thoroughly confused by this thread (which is itself confused partly because the Code and IRS guidance are not all that clear), but I'm pretty sure that 416(g)(4)(H)(i)'s reference to a CODA that satisfies 401(k)(12) means a CODA that does not need to test ADP because it satisfies either the nonelective or match safe harbor. 416(g)(4)(H)(ii)'s reference to 401(m)(11) and (12) isn't meant, I don't think, to say that you can only get out of top-heavy with the match safe harbor, but rather that if you do use the match for 401(k)(12), then the match needs to also satisfy (m)(11) or (12). Rev. Rul. 2004-13 perpetuates, unfortunately, what was a confusing statutory phrasing in the first place by including only a match in its example. Maybe the author of the Rev. Rul. didn't want to take any chances himself, given that he was providing guidance in absence of regs. Anyway, my guess would be that you are not top-heavy based on your hypothetical facts.

ASPPA 2005 Q and A #13 13. Revenue Ruling 2004-13 indicates the term “top-heavy plan” does not include a plan which consists solely of: 1. a cash or deferred arrangement that meets the requirements of section 401(k)(12) 2. matching contributions with respect to which the requirements of section 401(m)(11) are met. We have a safe harbor 401(k) plan provides for a 3% safe harbor nonelective contribution. No match is provided. Does this plan satisfy the condition required or must a match also be provided? A. Yes, it satisfies the provisions and no match is required. In this case there are a number of participants who enter the plan mid year, so the 3% safe harbor would not be based on total compensation. 5 A. That’s ok. Would the answer change if the Plan provides the 3% safe harbor contribution only to NHCE's.? This Plan has several HCE's who are not Key Employees A. Yes .............. all bets are off if, for instance , you have immediate eligibility to defer and a waiting period to be eligible for safe harbor.