Is Age 55 Catch-Up Prorated for 2006 if the Regular Contribution Limit is?

[namealreadyinuse]

For 2006, the maximum HSA contribution still had to be prorated if a participant was not eligible under an HDHP for the full year. Does anyonw know if the age 55 catch up contribution has to be prorated as well?

[Gary Lesser]

Yes, the catch-up contribution ($800 for 2007) is prorated the same manner as the annual contribution. However, if the individual is not eligible on the first day of taxable year (generally January 1) and the individual is covered under a HDHP on December 1 (and is otherwise an eligible individual), the full year's limit (for 2007, but not 2006) can be made. Testing period rules will require the individual remain eligible for thenext 12 months. Hope this helps.