From the Hotline: HSA Eligibility and Contributions
Question: Can the owner of a company make contributions to her HSA plan on a pretax basis? What about contributions from other employees? Can those employees contribute to the HSA on a pretax basis?
Answer: The company owner can generally qualify for a health savings account (HSA), assuming all other requirements are met; however, he or she cannot participate in a cafeteria plan. Under federal tax law, owners, 2-percent-or-more shareholders in Subchapter S corporations, partners in LLPs, and members of LLCs are deemed self-employed individuals and therefore are ineligible to participate in a cafeteria plan. Although cafeteria plan participants (that is, W-2 employees) may make pretax contributions to HSAs, if the cafeteria plan includes that option, the owner is not eligible. However, the owner may contribute to an HSA outside of a cafeteria plan. Outside of a cafeteria plan, contributions are made on an after-tax basis and then the individual may take an “above the line” deduction later on when filing individual annual tax returns.