Form 8889 Line 3: How to Calculate Your HSA Limit
This guide clarifies how to report HSA contributions on Form 8889, focusing on the distinction between personal and employer deposits for Line 3.
Form 8889, Health Savings Accounts (HSAs), is the document you file with your tax return to report all activity related to your HSA. This includes contributions you made, contributions from your employer, and distributions for medical costs. Filing this form is how you claim the tax deduction for your eligible contributions, which lowers your taxable income. This article focuses on the calculations in Part I, specifically how to determine the amount for Line 3.
Calculating Your HSA Contribution Limit
Before you can determine the specific figure for Line 3, you must first know your maximum legal HSA contribution for the year. This amount is calculated and entered on Line 2 of Form 8889. The Internal Revenue Service (IRS) sets these limits annually. For 2025, the limits are $4,300 for self-only coverage under a high-deductible health plan (HDHP) and $8,550 for family coverage.
If you are age 55 or older by the end of the tax year, you are permitted to contribute an additional $1,000 as a “catch-up” contribution. This amount is not adjusted for inflation. This additional contribution is added to your base limit, so an individual over 55 with self-only coverage in 2025 could contribute up to $5,300.
A provision known as the “last-month rule” applies if you became eligible for an HSA mid-year. This rule allows you to contribute the full maximum amount for the year, provided you were an eligible individual on the first day of the last month of your tax year (December 1 for most taxpayers). To use this rule, you must remain an eligible individual throughout the entire following year, known as the testing period. Failing to remain eligible will require you to include the extra contributions as income and pay a 10% additional tax.
Determining the Amount for Line 3
Line 3 of Form 8889 is where you enter the total amount you personally contributed to your HSA for the tax year. This includes any direct, post-tax contributions you made from your bank account. You can make these contributions for a specific tax year up until the tax filing deadline, which is typically April 15 of the following year.
The most common point of confusion regarding Line 3 is what not to include. You should not report any contributions made by your employer on this line. Employer contributions, which are typically made pre-tax through a cafeteria plan, are reported separately and can be found in Box 12 of your Form W-2, identified by the code “W”.
Additionally, rollover contributions from another HSA or an Archer MSA should not be included on Line 3. These are not considered new contributions for the year. To verify the total contributions made to your account, you can reference Form 5498-SA, “HSA, Archer MSA, or Medicare Advantage MSA Information.” Your HSA custodian is required to send you this form, which details all contributions from you and your employer.
Completing the HSA Deduction Calculation
Once you have determined your contribution limit for Line 2 and your personal contributions for Line 3, you can proceed with the rest of the calculations in Part I to find your final deduction.
The next step involves entering any employer contributions from your W-2 on Line 9. You will also add any qualified HSA funding distributions from an IRA on Line 10. The sum of these is entered on Line 11, which represents total contributions not made by you. This total is then subtracted from your contribution limit to determine your adjusted limit on Line 12.
Your allowable HSA deduction, entered on Line 13, is the smaller of your personal contributions from Line 3 or your calculated contribution limit from Line 12. This final figure is then transferred to Schedule 1 of your Form 1040 as an adjustment to income, resulting in a lower tax liability for the year.