Can You Roll Over Your HSA to the Next Year? Limits and Transfers

Yes, an HSA rolls over to the next year automatically. Every dollar left in the account on December 31 is still there on January 1, with no cap on the carryover and no deadline to spend it. You personally own the account, so the balance follows you across years, jobs, health plans, and retirement.¹

Why the Balance Carries Over

An HSA is a tax-exempt trust or custodial account in your name. The IRS states directly that amounts remaining at the end of the year carry over to the next year.¹ There is no annual forfeiture, no total-balance ceiling, and no clock that starts running on unused funds. Contribute for thirty years without touching the account and the full balance still belongs to you.

The question comes up so often because Flexible Spending Accounts work the opposite way. FSAs operate under Section 125, which treats unused balances as deferred compensation and requires forfeiture at the end of the benefit period.² HSAs carry no equivalent rule. The annual contribution limits cap what goes in each year; they do not cap what accumulates.

No Deadline to Reimburse Yourself Either

The rollover isn’t just about the dollars sitting in the account. It also applies to medical expenses you’ve already paid out of pocket. As long as the expense was incurred after you established the HSA, the IRS sets no time limit on when you can reimburse yourself.¹ Pay a doctor’s bill from your checking account this year, keep the receipt, and pull that amount from your HSA tax-free a decade later if you want to. The withdrawal stays qualified no matter how much time passes.

Save your receipts and any explanation-of-benefits statements. The reimbursement right is only as good as your ability to document the expense if the IRS asks.

2026 Contribution Limits

What rolls over is separate from what you can add. Each year the IRS resets the contribution ceiling for new money. For 2026:

Self-only HDHP coverage: $4,400
Family HDHP coverage: $8,750
Catch-up contribution at age 55 or older: an additional $1,000, set by statute and not indexed for inflation

These limits cover the combined total of your contributions and any employer contributions.³ If your employer puts $1,200 into your family HSA, your own contribution room for the year is $7,550. The catch-up figure is fixed at $1,000 in the statute.⁴

Losing Eligibility Doesn’t Touch the Rolled-Over Balance

To keep adding new money, you have to remain HSA-eligible: enrolled in a qualifying High Deductible Health Plan, without disqualifying other coverage, not enrolled in Medicare, and not claimed as someone else’s dependent. For 2026, a qualifying HDHP has a minimum annual deductible of $1,700 (self-only) or $3,400 (family), with out-of-pocket maximums no higher than $8,500 or $17,000.⁵ A general-purpose FSA disqualifies you; a limited-purpose FSA covering only dental and vision does not.

Starting in 2026, the One Big Beautiful Bill Act treats bronze and catastrophic marketplace plans as qualifying HDHPs even when they don’t meet the usual deductible or out-of-pocket thresholds, and enrolling in a direct primary care arrangement no longer breaks eligibility.⁵

If you lose eligibility, whether by switching to a non-HDHP, enrolling in Medicare, or picking up disqualifying coverage, your existing balance stays right where it is. You just can’t contribute new money for the months you’re ineligible. Withdrawals for qualified medical expenses remain tax-free for as long as the account exists.¹ The same portability rule covers job changes: employer contributions vest immediately, so the balance follows you out the door whether you quit, get laid off, or retire.

Moving Your HSA to a Different Provider

“Rollover” sometimes means shifting the account itself to a new custodian, usually to get better investment options or lower fees. Two methods exist, and one is safer than the other.

Direct Trustee-to-Trustee Transfer

Your current custodian sends the money straight to the new one. You never handle the funds. There’s no 60-day deadline, no cap on how often you can do it, and no complicated tax reporting. Most providers offer a “Transfer of Assets” form on their website. Processing typically takes a few weeks.

Indirect Rollover

You withdraw the money and redeposit it into the new HSA yourself. Two rules apply. First, you have 60 days from receiving the funds to complete the deposit; miss the window and the whole amount becomes a non-qualified distribution, taxed as income and hit with a 20% additional tax if you’re under 65.⁴ Second, you’re capped at one indirect rollover per 12-month period. Direct transfers don’t count against that limit, so if you’ve already used your one indirect rollover, a direct transfer is the only option left.

Report either kind of movement on IRS Form 8889 with your tax return so the transferred amount isn’t mistaken for new contributions or a taxable distribution.⁶ Hold onto deposit confirmations and transfer statements. Some providers charge a $20 to $25 account closure or transfer-out fee, so check before you initiate.

Where the Rollover Rule Ends: Death of the Account Holder

The indefinite carryover holds for as long as you’re alive. After death, the beneficiary you named on the account determines what happens next. A spouse beneficiary simply takes over the HSA as their own, with no tax triggered and all the usual rules intact. For any non-spouse beneficiary, the account stops being an HSA on the date of death and the fair market value becomes taxable income to that beneficiary in the year of death, reducible only by qualified medical expenses of the deceased that the beneficiary pays within one year of the date of death. If the estate is the beneficiary, the value goes on the decedent’s final return instead.¹ Naming a spouse as beneficiary is the one way to keep the rollover treatment intact past your lifetime.

1
Internal Revenue Service. Publication 969 (2025), Health Savings Accounts and Other Tax-Favored Health Plans
2
FSAFEDS. FAQs
3
Internal Revenue Service. Rev. Proc. 2025-19
4
Office of the Law Revision Counsel. 26 U.S. Code 223 – Health Savings Accounts
5
Internal Revenue Service. Expanded Availability of Health Savings Accounts under the One, Big, Beautiful Bill Act
6
Internal Revenue Service. 2025 Instructions for Form 8889