Maximum Dollar Limit. Payment networks, Participating Merchants, Providers or we may establish Transaction limits from time to time in their or our discretion. As a result, you may be unable to use Digital Wallet Services to complete a Transaction that exceeds these limits.
Maximum Dollar Limit. For an eligible individual with self-only coverage, the maximum annual dollar limit is $2,250 (indexed for COLAs) (for 2007 this amount is $2,850 and for 2008 it is $2,900). For an eligible individual with family coverage, the maximum annual dollar limit is $4,500 (indexed for COLAs) (for 2007 this amount is $5,650 and for 2008 it is $5,800). These dollar limits are adjusted for cost-of-living increases, rounded to the nearest increment of $50. Partial Year Coverage under Qualifying HDHP Prior to 2007, an eligible individual’s annual contribution limit was based upon the number of months during the year that the individual was actually covered under a qualifying high deductible health plan (HDHP). For example, if the individual began HDHP coverage on July 1st and the HDHP’s deductible amount was $2,000, the individual’s contribution limit for that year was $1,000 ($2,000/12 X 6 = $1,000). However, the HDHP’s deductible amount was not prorated. Consequently, the eligible individual still had to reach the HDHP’s $2,000 deductible before the health plan would pay any benefits. Beginning for contributions made for 2007 and thereafter, if an eligible individual is covered under the HDHP during the last month of the year, the individual is eligible to make the full HSA contribution, depending upon the type of coverage under the HDHP (self-only or family). This provision, therefore, “deems” that the individual was covered under the HDHP for the entire year and thus permits the individual to make the full contribution regardless of the actual number of months he was covered under the HDHP. For example, an individual becomes enrolled under his company’s HDHP with self-only coverage in December 2007. His 2007 HSA contribution limit is $2,850 even though he was covered under the HDHP for only one month during 2007. However, in order to use this rule, the individual must continue coverage under the HDHP during the “testing period”. Otherwise, the amount contributed in excess of the amount that could have been contributed under the monthly-limitation rule is subject to tax, plus an additional tax equal to 10%. This tax applies for the year when the individual ceases to be eligible to make HSA contributions, except due to death or becoming disabled. The testing period begins the last month of the taxable year and ends on the last day of the 12th month following such month. Prorating Still Applies in Some Cases Prorating the contribution limit in accordance with the mont...
