If you become eligible for an HSA anytime on or before December 1 of any year you can contribute to your HSA as if you were eligible for the entire year. BUT...This is only true as long as you continue to be covered by a qualified high deductible health plan (HDHP) for 12 full months beginning with December of the year in which you became eligible for an HSA. This 12-month period is known as the “testing period.” If you are not covered by a qualified HDHP during the entire testing period, all contributions attributable to months (in the preceding tax year) for which you were not an eligible individual are included in gross income for the year in which you cease to be an eligible individual.

If you do not satisfy the testing period described above, your maximum contribution, and your catch-up contribution, is pro-rated based on the number of months during the calendar year that your insurance is in effect. For example, if your insurance becomes effective on April 1, you only have 9 months of coverage during the calendar year. Therefore, your maximum deductible contribution to your HSA plan is 9/12ths of the annual allowable deductible. Conversely, if you terminate your insurance prior to calendar year-end, the same pro-rata formula will apply.