HSA Calculator: Triple Tax Advantage and Growth

Enter your current balance, what you and your employer put in each year, your age, an expected return, and your tax rate to see what your HSA could be worth at 65 and how much tax it saves compared with an ordinary taxable savings account.

Short answer: for 2026 you can put up to $4,400 (self-only HDHP) or $8,750 (family HDHP) into a health savings account, plus $1,000 if you are 55 or older, according to Rev. Proc. 2025-19. In the 22% bracket, a $4,400 payroll contribution saves $968 of federal income tax and $336.60 of Social Security and Medicare tax, and the money then grows and comes out tax-free for qualified medical expenses.

The calculator is for informational purposes only, and every result is an estimate built on the return and tax rate you type in. Your actual savings depend on your HDHP coverage month by month, your state, and what the market does.

What are the 2026 HSA and HDHP limits?

You can contribute only for months you are an "eligible individual": covered by a high deductible health plan (HDHP) on the first day of the month, with no other disqualifying health coverage, not enrolled in Medicare, and not claimable as someone else's dependent (IRS Publication 969). Starting in 2026, bronze and catastrophic marketplace plans count as HDHPs (IRS Notice 2026-5). An HSA contribution also lowers the household income used for the marketplace subsidy, which the ACA premium tax credit calculator can show.

The out-of-pocket maximum covers deductibles, copays, and coinsurance but not premiums, and only in-network costs count if the plan uses a provider network. The $1,000 catch-up is set by statute and is not adjusted for inflation. All 2026 inflation adjustments, including the health FSA and commuter limits, are collected in the 2026 IRS inflation adjustments guide.

Married couples: if either spouse has family HDHP coverage, both are treated as having family coverage, and the $8,750 is split between you equally unless you agree on a different split. There is no joint HSA. Each spouse who is 55 or older adds their own $1,000 to their own account, so a couple who are both 55+ can put in $10,750 for 2026.

What changed for HSAs in 2026?

The One Big Beautiful Bill Act widened who can contribute. The IRS explained the changes in Notice 2026-5:

• Telehealth before the deductible is permanent. An HDHP can cover telehealth and other remote care with no deductible, and having that coverage no longer disqualifies you. This applies to plan years beginning after December 31, 2024.
• Bronze and catastrophic plans count as HDHPs. For months beginning after December 31, 2025, a bronze or catastrophic plan that is available as individual coverage through an Exchange is treated as an HDHP, even if its deductible or out-of-pocket limit falls outside the table above. This includes the same plan bought off-Exchange. A bronze plan an employer offers through SHOP generally does not qualify under this rule. It counts only if it meets the normal HDHP tests.
• Direct primary care no longer blocks contributions. A direct primary care service arrangement (DPCSA) is not treated as other health coverage if it charges only a fixed periodic fee of no more than $150 a month for one person or $300 a month for an arrangement covering more than one person. Annual billing works as long as it fits the monthly cap, for example $1,800 a year for one person. The arrangement must provide only primary care from primary care practitioners. Procedures needing general anesthesia, prescription drugs other than vaccines, and lab work not typically done in a primary care office don't count as primary care. You can pay the DPC fees from your HSA tax-free, but those fees do not count toward your HDHP deductible.

If your membership bills the insurer separately for visits, it is not a qualifying DPCSA (Notice 2026-5, Q&A-11), and it can still disqualify you.

How does the HSA calculator work?

The math, step by step:

1. Contribution cap. Each year the limit is $4,400 (self-only) or $8,750 (family), plus $1,000 once you reach 55. Your employer's deposit is applied first, and your contribution is reduced if the two together would exceed the limit; a warning appears when that happens. Limits are held at 2026 levels, so later inflation increases aren't modeled.
2. Balance at 65. Each year the tool adds both contributions, subtracts any medical withdrawal your strategy calls for, and grows the rest by your return.
3. Tax saved on contributions. Your own contribution × (your tax rate + 7.65% for payroll, 1.45% above the wage base, or 0% for direct contributions). Employer money isn't counted as your saving, because you wouldn't otherwise have received it tax-free.
4. Taxable-account comparison. The same dollars taken as pay instead: reduced by your tax rate (and FICA for payroll contributors), invested at your return with 15% tax on the growth each year, and making the same medical withdrawals.
5. HSA advantage is the HSA balance at 65 minus that taxable-account balance. It is the whole tax benefit in one number — the deduction, the untaxed growth, and the tax-free withdrawals are not added up separately, so nothing is double-counted.
6. If spent on non-medical costs after 65. Balance × your tax rate, the income tax you'd owe on a non-qualified withdrawal after 65.

Getting accurate inputs

• Don't enter payroll deferrals as employer money. Your own salary-reduction contributions go in "Your Annual HSA Contribution" with "Payroll deduction" selected. Only the employer's seed money or match goes in the employer field.
• Use only the tax you actually save. Enter your federal bracket, and add your state rate only if your state follows the federal HSA rules (California and New Jersey don't — see the state section below).
• Pick the FICA option that matches your pay. Above $184,500 of wages, a payroll contribution saves only Medicare tax.

Worked example: the triple tax advantage in dollars

Maya is 45 and single, has self-only HDHP coverage, earns $85,000 (22% bracket, below the $184,500 Social Security wage base), and puts the full $4,400 in through payroll each year until 65. She invests it and assumes 6% a year.

Benefit 1, going in. Employer and cafeteria-plan contributions are exempt from income tax withholding, Social Security, Medicare, and FUTA (Publication 15-B):

• Federal income tax saved: $4,400 × 22% = $968
• Social Security and Medicare saved: $4,400 × 7.65% = $336.60
• Total each year: $1,304.60, about 29.65 cents per dollar contributed

Benefit 2, while invested. Twenty start-of-year deposits at 6% grow to:

$4,400 × [(1.06^20 − 1) ÷ 0.06] × 1.06 = $4,400 × 38.993 = $171,568

Of that, $88,000 is contributions and $83,568 is growth that is never taxed while it stays in the account.

Benefit 3, coming out. Any of the $171,568 spent on qualified medical expenses, including Medicare Part B and D premiums after 65, is tax-free. Money spent on anything else after 65 is ordinary income, the same as a traditional IRA withdrawal — about $37,745 at 22%.

What the calculator shows for Maya (self-only, age 45, $0 balance, $4,400 payroll contribution, no employer money, 6% return, 22% rate, invest strategy): $1,304.60 a year of tax saved on contributions, an HSA of $171,568 at 65, and a taxable-account alternative of $108,716. That account invests $3,095.40 a year ($4,400 × (1 − 22% − 7.65%)) and grows at 5.1% after a 15% tax on growth. The HSA comes out $62,852 ahead if the money is spent on medical care.

If Maya instead paid $2,000 a year of medical bills from the HSA (the "spend" strategy), the account would reach about $93,583 after $40,000 of tax-free withdrawals, and the advantage over the taxable account would still be about $55,110.

Payroll HSA contributions vs direct contributions

Self-employed people can't run contributions through payroll for themselves. They deduct HSA contributions on Form 8889, and the deduction reduces income tax but not self-employment tax. Partners and more-than-2% S corporation shareholders can't make pre-tax salary-reduction contributions either. Pub 15-B treats employer contributions for them as guaranteed payments or distributions, and they claim the deduction on their own return if they're eligible. For other 1099 tax planning, see the independent contractor tax guide.

The FICA saving shrinks at higher pay. Above the $184,500 Social Security wage base, a payroll contribution saves only the 1.45% Medicare tax (2.35% above $200,000 of wages). You can see how a pre-tax deduction changes your take-home pay with the paycheck after tax calculator.

How the last-month rule and testing period work

If you're an eligible individual on December 1, the last-month rule treats you as eligible for the whole year at the coverage level you had on December 1. The catch is the testing period: you must stay eligible from December 1 through December 31 of the following year. If you drop HDHP coverage during that time for any reason other than death or disability, the extra amount the rule allowed becomes taxable income, plus a 10% additional tax (Pub 969).

Example. Luis, 40, starts family HDHP coverage on December 1, 2026, and contributes $8,750 for 2026. His testing period runs from December 1, 2026, to December 31, 2027. In June 2027 he switches to a PPO.

• Limit without the rule: December only, $8,750 × 1 ÷ 12 = $729.17
• Amount added to 2027 income: $8,750 − $729.17 = $8,020.83
• Additional tax: $8,020.83 × 10% = $802.08, plus regular income tax on the $8,020.83

Without the last-month rule, the limit is prorated by month. Someone with self-only coverage from January through August 2026, then no HDHP, can contribute $4,400 × 8 ÷ 12 = $2,933.33.

What happens to your HSA when you sign up for Medicare?

Your contribution limit becomes zero starting with the first month you're enrolled in Medicare. That includes any months of retroactive coverage, so if your Medicare enrollment is backdated, contributions for those months become excess contributions (Pub 969).

Example, using the Pub 969 method with 2026 numbers: you turn 65 and enroll in Medicare in July 2026, with self-only HDHP coverage. Your limit is ($4,400 + $1,000) × 6 ÷ 12 = $2,700, for January through June.

Turning 65 doesn't by itself stop contributions. Enrolling in Medicare does. Once you stop contributing, the account still pays tax-free for:

• Medicare Part A, Part B, Part D, and Medicare Advantage premiums once you're 65. Medigap supplement premiums don't qualify.
• COBRA premiums, and health coverage while you're collecting unemployment.
• Long-term care insurance premiums, up to an age-based cap. For 2026 the caps are $500 (age 40 or under), $930 (41–50), $1,860 (51–60), $4,960 (61–70), and $6,200 (over 70), per Rev. Proc. 2025-32.

What does a non-medical HSA withdrawal cost?

Before 65, a withdrawal that isn't for qualified medical expenses is taxed as ordinary income plus a 20% additional tax. There's no 20% tax if the withdrawal comes after you become disabled, reach 65, or die.

Example. A 50-year-old in the 22% bracket withdraws $3,000 for a car repair: $3,000 × (22% + 20%) = $1,260 in federal tax, leaving $1,740. The same withdrawal at 66 costs $660 in income tax and nothing more.

HSA mistakes that trigger tax or penalties

• Contributing too much. Excess contributions aren't deductible and are hit with a 6% excise tax (Form 5329) for every year they stay in the account. You avoid the excise tax if you withdraw the excess and its earnings by your return's due date, including extensions.
• Keeping a general-purpose health FSA. A regular health FSA or HRA, yours or your spouse's, generally makes you ineligible. Limited-purpose (dental and vision), post-deductible, suspended, and retiree-only arrangements are allowed. The FSA and commuter benefits tax savings guide covers the FSA side, and the FSA and commuter benefits calculator prices a limited-purpose FSA election.
• Paying for expenses incurred before the HSA was opened. They aren't qualified, even if you were already on an HDHP. State law decides the date an HSA is established.
• Double-dipping. You can't reimburse yourself from the HSA and also itemize the same expense on Schedule A.
• Losing receipts. Pub 969 doesn't set a deadline for reimbursing yourself, but you must be able to show the expense was qualified, incurred after the account was opened, and never reimbursed elsewhere or itemized. The IRS says to keep those records with your tax files rather than send them in.
• Naming the wrong beneficiary. A surviving spouse beneficiary simply takes over the HSA. For anyone else, the account ends at your death and its fair market value is taxable to them. That amount is reduced by your medical bills they pay within one year.

Which form reports an HSA, and when are contributions due?

File Form 8889 with your Form 1040 if you or your spouse had any HSA activity during the year, even if only an employer contributed. Your custodian reports withdrawals on Form 1099-SA and contributions on Form 5498-SA.

You can make 2026 contributions until April 15, 2027. Tell the custodian the deposit is for 2026. Employers can also make prior-year contributions during that window, but they must tell you and the custodian which year it's for.

Do states tax HSA contributions?

Most states follow the federal treatment, but not all. California doesn't conform. Its 2025 Form 540 instructions disallow the HSA deduction, add employer HSA contributions (W-2 box 12, code W) back to income, and tax the account's interest and earnings in the year they are earned. A few other states also depart from federal rules, so check your state's instructions for the HSA line before entering a combined federal and state rate in the calculator.

If you're weighing an HSA against other ways to save for retirement, run the same contribution through the Roth conversion calculator or the federal tax bracket calculator to see your marginal rate now versus later. An HSA is most valuable when you expect to spend it on medical costs, since those withdrawals are the only ones that are never taxed.