The HSA Last-Month Rule: Eligible on December 1
Eligible on December 1 means you count as eligible for the whole year and may contribute the full annual limit. The condition is a 13-month testing period.
If you are an eligible individual on December 1, the last-month rule treats you as eligible for the whole year. You may contribute the full annual limit for that December coverage type. A testing period follows.
The HSA contribution limit calculator shows both figures side by side: the prorated limit your eligible months earned, and the full limit the last-month rule would allow. This page explains what sits between them.
What the rule says
Publication 969 states it in one sentence: “Under the last-month rule, if you are an eligible individual on the first day of the last month of your tax year (December 1 for most taxpayers), you are considered an eligible individual for the entire year.”
The test date is December 11. For the 2026 tax year that day is a Tuesday. Eligibility on that day is judged the same way as any other month: qualifying high-deductible coverage, no disqualifying other coverage, no Medicare, and not claimable as someone’s dependent.
The rule is available, not compulsory. A person eligible on December 1 may contribute their prorated limit instead and never touch it.
What it is worth
The gain is the difference between the two limits.
amount at stake = full annual limit − prorated limit
Example. A hypothetical taxpayer takes self-only high-deductible coverage effective October 1 and keeps it through December. Three eligible months give a prorated limit of three twelfths of the annual amount. The last-month rule would allow twelve twelfths. Nine twelfths of the annual amount is the difference, and it is the amount exposed to the testing period.
For 2026 the annual amounts are $4,4002 for self-only coverage and $8,7503 for family coverage. The coverage type you hold on December 1 is the one that sets the full-year limit.
The condition attached
Publication 969: “If contributions were made to your HSA based on you being an eligible individual for the entire year under the last-month rule, you must remain an eligible individual during the testing period.”
That period runs December 1 of the contribution year through December 31 of the following year4. For a 2026 contribution it begins December 1, 2026 and ends December 31, 2027 — thirteen months.
Fail it, for reasons other than death or becoming disabled, and Publication 969 says you “include in income the total contributions made to your HSA that wouldn’t have been made except for the last-month rule”, and “this amount is also subject to a 10% additional tax”. The mechanics, including which year the income lands in, are set out in the HSA testing period.
Full year, so full catch-up
The Additional Contribution Amount Worksheet in the Instructions for Form 8889 multiplies the age-55 catch-up of $1,0005 by the months you were an eligible individual, divided by twelve. The last-month rule makes that count twelve, because Publication 969 treats you as “an eligible individual for the entire year”.
The catch-up money is therefore inside the testing period as well. It is part of the amount that “wouldn’t have been made except for the last-month rule”.
Timing
The decision does not have to be made in December. Contributions for the 2026 tax year may be made until April 15, 20276, so the money can go in months after the December 1 test is passed.
The testing period does not move with the payment date. It is fixed to December 1 of the contribution year.
What is the HSA last-month rule?
It is the rule that treats an individual who is HSA-eligible on December 1 as eligible for the entire tax year. The effect is a full annual contribution limit instead of a prorated one.
Do I have to use the last-month rule?
No. It is optional. Contributing only your prorated limit leaves you outside the testing period entirely, and nothing has to be reported.
What does the last-month rule cost if I lose eligibility?
The contributions that were only possible because of the rule are added to your income for the year you fail, and Publication 969 applies “a 10% additional tax” to that amount. Your prorated limit is not disturbed.
Which coverage type sets the limit under the last-month rule?
The coverage you hold on December 1. Family coverage on that date gives the family annual limit for the year, even if earlier months were self-only or uncovered.
Does the last-month rule apply to the age-55 catch-up?
Yes. Publication 969 treats you as eligible for the entire year, and the Form 8889 worksheet counts eligible months, so the full catch-up is available and the full catch-up is inside the testing period.
Is this the same testing period as an IRA-to-HSA transfer?
No. Publication 969 gives a qualified HSA funding distribution its own testing period, which “begins with the month in which the qualified HSA funding distribution is contributed and ends on the last day of the 12th month following that month”.
Does the last-month rule change my contribution deadline?
No. The deadline for a 2026 contribution stays April 15, 20276, whether the limit is prorated or full.
Open the HSA calculator →Sources
Information, not advice. This is the reading version; the interactive calculator and the full page are at https://thresholds.pages.dev/hsa/last-month-rule/.