Are you a domestic partner? Are you on a family HDHP? Do you each have your own HSA account? If so, both you and your domestic partner (even if you are on the same family HDHP) are each eligible to contribute the maximum family contribution to your own HSAs. In 2025, the maximum family contribution is $8550, so the two of you could contribute a combined $17,100 for the year.
Whether it makes sense for you to do this is dependent on a variety of factors. However, for some scenarios, this could be a great loophole!
Here are the main factors for consideration:
- Domestic partners on a family HDHP may need to pay taxes on imputed income on the other partner’s portion of the health insurance premium. If you are already on your partner’s family HDHP, then you may be paying this cost already – check with your HR or benefits manager. However, if you want to be added to the plan just to be eligible for the HSA contribution, you should weigh the cost versus the financial benefit of the HSA loophole.
- Cash available to make the maximum family contribution. Do you have enough cash on hand to make such a big contribution? Will you be funding the HSA with pre-tax or post-tax cash? Perhaps you may need the cash to pay for other more urgent things. Or it may make more sense to contribute to a Roth IRA instead if you are eligible for both and have limited cash to contribute.
- Your current and projected usage of HSA funds. This involves understanding how much you may need for healthcare now and when you reach retirement. Some things to consider include what you can spend HSA funds on and what happens to your HSA in retirement. In retirement, you can pay for medical, dental insurance premiums with your HSA which, regardless of your health, you are likely to pay. After age 65, HSA funds that are used for non-medical expenses are only taxed like traditional IRAs, so you don’t “lose” the funds if you overfund it.
Should you take advantage of the HSA loophole?
For unmarried partners, the HSA contribution loophole can be pretty beneficial, allowing you to maximize your healthcare savings and reduce your taxable income. If both of you are in a position to be enrolled in a family HDHP and make full use of HSA contribution limits, this strategy could help you save lots of money in tax-free healthcare expenses down the line.
Resources
These posts have the best explanation of the loophole and different scenarios:
- https://learn.hellofurther.com/Individuals/Life_Changes/How_Spouses_and_Domestic_Partners_can_Manage_an_HSA
- https://www.newfront.com/blog/hsas-and-domestic-partners
How the IRS allows this:
As always, reddit has some discussion on this matter:
Things I wish I knew before. . . 