HSA contribution

[Questionguy101]

A client had been using a HSA account for himself and he has made individual contribution of $3,000 in early 2011.

Then in December 2011, he started having a HSA compatible family health policy together with his wife.

He said his HSA custodian representative told him that since his family health policy has started in December 2011, he could made an additional contribution of $3,000 for year 2011 to his HSA account.

Is it correct? It makes more sense to me if the additional contribution amount is to be prorated. Like if the switch to family plan started in December, only $250 ($3,000/12 months) additional contribution can be made.

So is the custodian representative correct?

[dan doshan]

The way I understand it is that if he had family coverage on the 1st day of Dec 2011 he could use family for the entire year. From your post it does not sound like he had family coverage effective Dec 1, 2011.

Wouldn't bet my life on the above though.

[MilTaxEA]

Wouldn't that fall under the last-month rule on page 13-29 of TTB? If they are an eligible individual as of 1 December, they are considered to be eligible all year.

Someone chip in if I am interpreting this incorrectly.

Edit: Looks like Dan replied the same time as me.