Our live chat (yes, we have real myHSA employees answering every single live chat question!) team wanted to help clear up what the definition of a “dependent” is.

A dependent that is eligible under an HSA is defined as:

A) The employee's spouse by marriage or common-law, and/or

B) Related to the employee by blood or adoption and living in the same primary residence.

C) Dependents (not spouses) must be financially reliant on the employee. There is no age limit on dependents if they fit the above criteria.

Below are a few common, and not-so-common examples of eligible dependents:

John has an HSA through his employer. John’s wife, Susie, works full time and is considered a dependent as John’s spouse. Their 14-year-old son, Adam, lives at home and is considered a dependent as he is related to the employee (John) and is living in the same primary residence. Adam’s sister, Julie, is 23 and is living at home with her parents while she attends University. Julie is considered a dependent as she is related to the employee (John) and is financially reliant on him.

Kim lives in Calgary and she has an HSA through her employer. Her daughter, Melanie, is 20 and goes to University in Ottawa but comes back to live at home with Kim during school breaks and over the summer. Melanie is considered a dependent by being Kim’s daughter and living with her as her primary residence.

Brad has an HSA through his employer. Brad’s elderly parents are retired and live with him in the same house. Being his parents, and financially reliant on him, they are considered dependents.

Now, here are some scenarios of people who are NOT eligible to be dependents:

Chad has an HSA through his employer. Chad’s elderly parents recently had to enter a nursing home that Chad pays for. His parents are NOT considered dependents since they do not live with Chad as their primary residence.

Wayne has an HSA through his employer, and recently his brother-in-law Dave moved in with Wayne and his family for a few months after going through a divorce. Dave has a job and is not financially reliant on Wayne, and is not related by blood, so he is NOT considered a dependent.

Kim from our example above had her daughter Melanie’s boyfriend, Chase, move in with her while Melanie is home on summer break from University. Chase does not have a job and while he is financially reliant on Kim, he is NOT considered a dependent as he is not related to Kim.

We hope this clears up some questions regarding dependents when it comes to HSAs! If you have any questions, hit the “help” bubble in the bottom right to be connected to our chat team.

Sources: https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/it339r2/archived-meaning-private-health-services-plan-1988-subsequent-taxation-years.html — ARCHIVED - Meaning of private health services plan [1988 and subsequent taxation years] - Canada.ca