Rev Rule 2005-25 <br>Family Coverage Won't Disqualify Spouse From HSA

[Gary Lesser]

Family Coverage Won't Disqualify Spouse From HSA, IRS Rules

A married individual who is eligible to contribute to a health savings account (HSA) does not lose eligibility when his or her spouse has low-deductible family health coverage, provided the spouse's plan does not cover the individual, the IRS ruled on April 13.

According to Rev. Rul. 2005-25, the special rule in the Internal Revenue Code treating both spouses as having only family coverage when either one has family coverage does not apply when the other spouse's low-deductible coverage excludes his or her spouse. It also does not affect the eligible spouse's eligibility to make HSA contributions up to his or her annual contribution limit.

The maximum amount that an eligible individual may contribute to an HSA is based on whether the individual has self-only or family high-deductible health plan (HDHP) coverage, the IRS said. For 2005, the contribution limit is the lesser of the annual deductible under the HDHP (minimum of $1,000 for self-only coverage and $2,000 for family coverage) or $2,650 for self-only coverage and $5,250 for family coverage.

A married individual who is eligible to contribute to a health savings account (HSA) does not lose eligibility when his or her spouse has low-deductible family health coverage, provided the spouse's plan does not cover the individual, the IRS ruled on April 13.

According to Rev. Rul. 2005-25, the special rule in the Internal Revenue Code treating both spouses as having only family coverage when either one has family coverage does not apply when the other spouse's low-deductible coverage excludes his or her spouse. It also does not affect the eligible spouse's eligibility to make HSA contributions up to his or her annual contribution limit.

The maximum amount that an eligible individual may contribute to an HSA is based on whether the individual has self-only or family high-deductible health plan (HDHP) coverage, the IRS said. For 2005, the contribution limit is the lesser of the annual deductible under the HDHP (minimum of $1,000 for self-only coverage and $2,000 for family coverage) or $2,650 for self-only coverage and $5,250 for family coverage.

Rev. Rul. 2005-25 is available online at