tl;dr: Rippling does not ensure HSA contributions and deposits actually match, leading to a situation where you may have money withheld from your paycheck that doesn’t actually get deposited into your HSA. If you use Rippling and have made manual HSA contributions during the year, go audit your contributions and make sure they match the deposits into your HSA account.

The setup: A simple math error

My company uses Rippling’s PEO. I have an HDHP with an HSA. The plan includes a $200/mo employer contribution, and I opt to contribute another $200/mo. This should result in $4800/yr deposited into my HSA.

In October, I made a manual contribution of $4150 with the aim of hitting the HSA contribution limit ($8550 for 2025). I wasn’t paying close attention to the fact that my health plan ends on November 30th, and because the projected contributions feature in Rippling doesn’t work properly with non-calendar year health plans (it projected $4400), I ended up over-contributing by $400. A simple mistake, but one I figured I’d just correct with some excess-contribution tax forms in the new year.

The Failure

In December, Rippling’s HSA system realized I had reached the annual contribution limit and blocked further deposits. But this information apparently didn’t spill over into their payroll system which happily continued to withhold funds. The result:

  • Rippling withheld $200 from my December paychecks as shown on my paystubs
  • Rippling shows my company contributed $200 on my December paystubs
  • The money was never deposited into my HSA
  • The $400 (my $200 + the company’s $200) simply sat in my employer’s payroll account, an interest-free loan from me to them, and a hidden liability on my company’s ledger.
  • My W2 is now incorrect: it shows $4800 for Box 12 Code W (i.e. HSA contributions), but that’s $400 off from reality.

Rippling failed to notify me, and they failed to notify my employer about any issues here. I only happened to notice because I track my finances using beancount and things weren’t adding up right.

Support’s response: “It’s not a bug, it’s a feature gap”

Trying to get support to understand there was an actual issue here was a chore. I eventually had to have my COO escalate the issue via our Rippling CSM, and in the end the explanation was:

The shortfall occurred because direct HSA contributions made through the HSA portal do not currently sync back into Rippling payroll. As a result, payroll deductions continued based on your existing settings, which caused the discrepancy.

I have passed detailed feedback to our product team regarding this issue. We are exploring enhancements to allow direct contributions via Elevate to sync with Rippling payroll, which would prevent this situation from happening in the future.

I asked directly if there was ever a plan to notify me:

To answer your question directly about “Would You Have Been Notified if This Was Not Caught?”: no, Rippling does not proactively notify employees about reaching the annual HSA contribution limit as part of year-end audits.

When I expressed my frustration with this situation and that my money was missing, they brushed it off because the money was still in my employer’s bank account (emphasis mine):

The deductions that you see in your paycheck are essentially reducing your net pay, meaning the cash was never paid out to you. [snip] However, because Rippling did not pull those funds to send to the HSA (due to the limit), the cash never left the company’s account.

When my COO asked what they can do to ensure it doesn’t happen moving forward:

As a current workaround, we recommend that employees avoid making direct HSA contributions through the Elevate HSA portal, as these contributions are not reflected in payroll and may impact contribution tracking. All HSA contributions - regardless of source - count toward the annual IRS limit.

So they’re basically treating the issue like a product shortcoming rather than a serious bug, and even trying to shift the blame by suggesting workarounds or telling me the money is still with my company, as if they were the ones at fault here.

The Bottom Line

I don’t blame my company at all for this. We’re a small team, and the whole reason we use Rippling as our PEO is so that we don’t have to understand or deal with these sorts of things. We’re paying Rippling to be the expert here, and when they fail, it reveals all the promises of the PEO to be a lie. If I hadn’t been fortunate enough to notice the issue, I don’t have confidence Rippling would ever have informed me about the discrepancy. And so I’m still waiting for this to be resolved, wondering what other unnoticed mistakes Rippling has made with my payroll.

If you’re unfortunate enough to have to use Rippling, I recommend auditing your HSA ledger against your YTD paystub deductions. And if you are looking for a PEO, I strongly suggest looking elsewhere.

Rippling HSA Shenanigans Double-Feature

At the same time this is all going on, my company is also struggling with a separate issue with HSA accounts. Rippling was billing us for something like “Flex Benefits” and “HSA/FSA management”. During our renewal discussions at the beginning of the year, they discovered this and offered to consolidate them since those features are for the same functionality.

In their process of doing so, they removed the HSA functionality for everyone, which triggered Elevate to believe I had separated from my employer. When that happened, my existing HSA funds were moved into an individual HSA account and I got charged a $3 management fee. And my Rippling benefits debit card stopped working, because it’s no longer linked to an HSA account. That’s been broken since the 7th and is still waiting to be fixed; in the meantime I don’t have a functional HSA.