An eligible expense is a health care service, treatment, or item the IRS states can be paid for without taxes. Show
Below is a partial list of eligible expenses that are reimbursable through a Health Savings Account (HSA). Eligible expenses can be incurred by you, your spouse, or qualified dependents. The HSA can only be used to pay for eligible medical expenses incurred after your HSA was established. For more information, see the HSA Eligible Expenses flyer. For the complete list of eligible and ineligible expenses, visit www.IRS.gov and see IRS Publications 502 and 969. How should I keep track of my eligible expenses?You should keep all your receipts and pertinent documentation to prove your HSA was used for eligible medical expenses. Note: If you pay for anything other than eligible expenses with your HSA, the amount will be taxable, and you will be required to repay the amount and pay an additional tax penalty. Changes at Age 65DistributionsAt age 65, you can take penalty-free distributions from your HSA for any reason.
Health Insurance PremiumsAt age 65, you can use your HSA to pay for Medicare Parts A, B, and D as well as Medicare HMO premiums tax-free and penalty-free.
Medical
Dental
Vision
1: Restrictions may apply. See IRS Publications 502 and 969 for more details. Members / Frequently Asked Questions FREQUENTLY ASKED QUESTIONS - MEMBERSHEALTH SAVINGS ACCOUNT FAQS & RULESWhat is an HSA?Health Savings Accounts (HSAs) are tax-advantaged medical savings accounts available to United States taxpayers who are enrolled in a High Deductible Health Plan (HDHP). HSAs are owned by the individual, differentiating them from company-owned Health Reimbursement Arrangements (HRAs) that are an alternate tax-deductible source of funds paired with HDHPs. And, unlike a Flexible Spending Account (FSA), HSA funds roll over and accumulate year over year if not spent, with the ability to earn tax-free interest on the account. HSA funds may be used to pay for qualified medical expenses at any time without federal tax liability. Is an HSA right for me?For eligible individuals covered by a qualified high deductible healthcare plan (HDHP), an HSA offers a number of benefits. Money that would otherwise be lost to high premiums could be invested in a tax-free, interest-bearing HSA. For those with higher medical expenses, an HDHP combined with an HSA still may provide overall cost savings as compared to a traditional plan with higher premiums and out of pocket maximums. Learn more about the benefits of having an HSA or use our health plan comparison calculator to determine if an HSA is right for you. Who is eligible to open an HSA?If you have a qualified High Deductible Health Plan (HDHP) - either through your employer or one you've purchased on your own - chances are you can open an HSA. Additionally:
*Title 38 of the United States Code, Section 101(17) defines "non-service-connected" as, with respect to disability, that such disability was not incurred or aggravated in line of duty in the active military, naval, or air service. If I change health plans or change employers, can I still contribute to my HSA?If you have a qualified High Deductible Health Plan (HDHP) - either through your employer or one you've purchased on your own - chances are you can still contribute to your HSA with HSA Bank.* Additionally:
*The content herein is provided for informational purposes. HSA Bank does not provide tax or legal advice. Please refer to IRS guidance, including IRS Publication 969, for additional details. **Title 38 of the United States Code, Section 101(17) defines "non-service-connected" as, with respect to disability, that such disability was not incurred or aggravated in line of duty in the active military, naval, or air service. Can I be covered under another health plan and still open an HSA?
What are the advantages of opening an HSA?An HSA is a unique tax-advantaged account that you can use to pay for current or future IRS-qualified medical expenses. With an HSA, you'll have:
What is the daily limit for HSA Bank's Health Benefits Debit Card?Your HSA Bank Health Benefits Debit Card provides access to your HSA funds at point-of-sale with signature or PIN and at ATMs for withdrawals. The daily debit card limit for the Health Benefits Debit Card is $5,000 at merchants dedicated to healthcare (e.g. a doctor’s office or hospital) and $3,500 at merchants that are not healthcare specific but offer eligible medical products and/or services (e.g. a department or grocery store). The number of debit card transactions allowed per day is limited and varies based on how the card is used or types of transactions processed. These limits exist as a safeguard against fraudulent activity. For more information, please call the number on the back of your Health Benefits Debit Card. How do I pay for an IRS-qualified medical expense that exceeds the Health Benefits Debit Card daily limit?HSA Bank provides you with multiple options to pay for an expense that exceeds the Health Benefit Debit Card daily limit of $5,000.* Your options include:
NOTE: your transactions are limited to your available cash balance. *Your HSA Bank Health Benefits Debit Card provides access to your HSA funds at point-of-sale with signature or PIN and at ATMs for withdrawals. The daily debit card limit for the Health Benefits Debit Card is $5,000 at merchants dedicated to healthcare (e.g. a doctor’s office or hospital) and $3,500 at merchants that are not healthcare specific but offer eligible medical products and/or services (e.g. a department or grocery store). The number of debit card transactions allowed per day is limited and varies based on how the card is used or types of transactions processed. These limits exist as a safeguard against fraudulent activity. For more information, please call the number on the back of your Health Benefits Debit Card. Do I need to submit receipts for my HSA expenses?No. You do not need to submit any receipts to us or file any claims. Just be sure to use the money for IRS-qualified medical expenses and save your receipts for tax purposes. Using our online expense tracker, you can easily enter medical expense information and securely upload receipts and supporting documentation – all in one place for easy access and tracking. Where can I use my HSA?You can use your HSA Bank Health Benefit Debit Card to pay for doctor visits at the time of the appointment or for qualified items at a pharmacy or other retailer as long as it is for a qualified medical expense. You can also use your debit card to withdraw cash from an ATM to reimburse yourself for expenses you paid out-of-pocket (a transaction fee may apply). How can I check my HSA balance?You can check your HSA balance by visiting the Member Website, where you will have secure, 24/7 access to your real-time account balances and transaction history. Visit our Member Features page to view other features to help simplify healthcare management. Can I use my HSA for a spouse?You can use your HSA to cover qualified medical expenses for you, your spouse, and any dependent children included on your income tax return. Who can contribute to an HSA?Any eligible individual may contribute to an HSA. For an HSA established on behalf of an employee both the employee and the employer may make contributions. Family members may also make contributions on behalf of other family members as long as the other family member is an eligible individual (has a qualified high deductible health plan and is not otherwise insured). What is a "catch-up" contribution?Eligible individuals over the age of 55 are allowed to make additional "catch-up" contributions to their HSAs. The catch-up amount is $1,000 and if you turn 55 during the year you can contribute the full $1,000. Are HSA contributions tax deductible?You can claim a tax deduction for contributions up to the applicable maximum contribution that you, or someone other than your employer, make to your HSA even if you do not itemize your deductions on Form 1040. Contributions up to the maximum contribution limit made by your employer may be excluded from your gross income. What if I don't use all of my funds within the year?Unused HSA funds roll over year to year; there is no "use it or lose it" penalty. Funds that are rolled over continue to grow and earnings are tax free. At age 65, you will have the ability to use your HSA funds for any purpose on a taxable basis. This makes funding your HSA a great way to save for retirement. Do HSA funds rollover?Any unused funds in your HSA automatically roll over each year. You will not lose any unspent money in your account. Can I invest my HSA?Yes you can. Choose from a wide range of securities, including mutual funds, stocks, bonds and more. You can transfer funds between your HSA cash and investment accounts in the Member Website OR by contacting our Client Assistance Center. Visit our HSA Investment page to learn more. How do I close my HSA?There are many benefits to your HSA that you should consider before closing your account. Consider keeping your HSA to continue to save for your future health expenses, tax free. If you still feel a need to close your account, please call our Client Assistance Center at (800) 357-6246. Does HSA Bank have a mobile app?Yes. HSA Bank Mobile is available on both Google Play (Android-powered devices) and the App Store (iPhone, iPod Touch, iPad). While it is a free download, you should check with your wireless provider for any associated fees for accessing the Internet from your device. IMPORTANT NOTE: Before you can use the app, you must create a Member Website username and password. Without a registered account, you will not be able to access any of the app’s functionality. FLEXIBLE SPENDING ACCOUNT FAQSWhat is an FSA?Flexible Spending Accounts (FSAs) are tax-advantaged financial accounts that can be set-up through employers' cafeteria plans in the United States. An FSA allows an employee to designate a portion of his or her pre-tax earnings to pay for qualified expenses as established in the cafeteria plan, most commonly for medical expenses, but often for dependent care or other expenditures. The employer is also allowed to make contributions to employee FSAs, if desired, in order to offer a greater benefit to the staff. Since the money deducted from an employee's pay for transfer to an FSA is not subject to federal, state, or payroll taxes, employees can save upwards of 40% on eligible expenses, and sometimes more, depending on their tax bracket. How does an FSA work?With an FSA, you elect to have your annual contribution deducted from your paycheck each pay period, in equal installments throughout the year, until you reach the yearly maximum that you have specified. The amount of your pay that goes into an FSA will not count as taxable income, so you will have immediate tax savings. FSA dollars can be used during the plan year to pay for qualified expenses and services. And at the end of the year, you can roll over up to $500 of your contribution to the next plan year, provided your employer's plan allows this. Annual participant contributions are limited by The Internal Revenue Service. To view current IRS limits, visit the IRS Guidelines and Eligible Expenses page for more information. What are the differences between Healthcare FSAs, Limited Purpose FSAs, and Dependent Care FSAs?
What if I don't use all of my funds within the year?Your plan document may provide for a grace period that allows you to use your remaining funds for IRS-qualified expenses incurred for up to 2 ½ months into the next year. Alternatively, if you have an FSA or Limited Purpose FSA, you may be eligible to roll over up to $500 of your contribution to the next plan year, provided your employer has changed the plan documents to allow this. This rollover option does not apply to Dependent Care FSAs. What happens if my employment ends?Deductions for your Healthcare FSA will also end when your employment ends unless your employer is obligated to offer you COBRA continuation and you elect this option. If your employer is not obligated to offer you COBRA and/or you choose not to elect COBRA, you are eligible to be reimbursed for qualified expenses incurred while you were employed and the account was active. Requests for reimbursements should be submitted prior to the end of your employer's run-out period or period of time for which a claim for an expense can be submitted for a plan year that has ended or after an employee has terminated. HEALTH REIMBURSEMENT ARRANGEMENT FAQSWhat is an HRA?Health Reimbursement Arrangements (HRAs) are employer-funded plans that reimburse employees for incurred medical expenses that are not covered by the company's standard insurance plan. Because the employer funds the plan, any distributions are considered tax deductible (to the employer). Reimbursement dollars received by the employee are generally tax-free. Unused HRA dollars may roll over from year to year, if allowed per plan rules, providing a potential incentive for employees to be better stewards of healthcare spending. If employment is terminated, the employer can choose to keep unused funds. What are the benefits of an HRA?
What types of medical expenses are covered by an HRA?
Can I contribute funds to my HRA?HRAs are only funded by your employer. Your employer contributes a determined amount to your HRA. Contact your HR department for specifics on your plan setup. Can I use an HRA if I have health insurance?Yes. An HRA is designed to cover expenses not paid by your health plan including deductibles, coinsurance and copayments as well as many expenses your health plan may not cover. What can I pay for with my HRA?HRA funds can be used on eligible expenses determined by your employer. These typically include co-pays, health insurance deductibles and other IRS approved healthcare expenses. For more information on your plan, contact your HR department. FORMS FAQSWhat expenses can I pay with HSA?HSA - You can use your HSA to pay for eligible health care, dental, and vision expenses for yourself, your spouse, or eligible dependents (children, siblings, parents, and others who are considered an exemption under Section 152 of the tax code).
What can you not pay with HSA?Other items that aren't eligible include maternity clothes, funeral costs, child care for healthy babies, toiletries, over-the-counter medicine, swimming lessons and elective cosmetic procedures. You also usually can't use HSA money to pay for health insurance premiums unless you meet certain criteria.
|