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Further hsa qualified expenses12/18/2023 ![]() ![]() Registered representative of Thrivent Investment Management, Inc. Securities and investment advisory services offered through Thrivent Investment Management Inc., a registered investment adviser, member FINRA and SIPC, and a subsidiary of Thrivent. Thrivent is the marketing name for Thrivent Financial for Lutherans. And then, start spending the funds whenever you need medical care or products. You may need to order checks, use an HSA debit card or submit receipts for reimbursement. Once your HSA arrangements are set, make sure you know how the institution handles paying for medical expenses from the account. In either case, pay close attention so that you don't deposit more than the amount allowed per year, or you'll risk a penalty. If that option isn't available, the financial institution where the HSA is can help you make deposits. Some employers will help you set up a payroll deduction so that the money goes to the HSA directly. They'll show you what's needed to start your account.Īt that point, you'll want to decide how frequently you want to deposit money into your HSA. In most cases, an employer or a plan provider already will have connected with a bank or credit union where you can create your HSA. When you sign up for an HSA-eligible insurance plan, ask your plan provider how to take advantage of the HSA option. Putting money in your HSA gives you an account to draw from for those higher up-front costs as well as your copays and any other qualifying medical expenses and incidentals that insurance doesn't stretch to cover. Many of these costs-other than your actual insurance premiums-also will be qualified HSA expenses. Your individual insurance plan will outline what kinds of coverage it offers, including whether you owe coinsurance, copays or some percentage of the cost for a certain kind of care. Those costs are part of what an HSA can be used for. For many of these, you'll pay more out of your own pocket up-front for the care and procedures you receive until you reach your deductible. HSA eligibility is only available with certain high-deductible plans that you usually get through your employer or the Health Insurance Marketplace. How does an HSA work with my health insurance?Īn HSA is essentially a tax-advantaged account you tuck away to help you cover whatever your health insurance doesn't. ![]() Once you turn 65, the 20% penalty for spending on nonmedical expenses is lifted, and you can use your HSA money for anything-but note that any nonmedical spending will still likely be subject to income tax. And if you don't end up using all your HSA money within the year, it will just accumulate for you to use in the future. When you spend on nonmedical expenses, there is a 20% penalty, so always double-check that an expense is qualified. Many HSAs use a debit card or checks that allow you to spend from them, similar to a checking account. Regardless of your contributing status, however, you can spend your HSA funds at any time. For instance, if you were to enroll in Medicare during retirement, you'd no longer be eligible to make HSA contributions. Just be aware that you'll have to stop contributing in any year that you aren't on an eligible plan. This might be arranged through a payroll deduction, or you can report how much you contributed to your HSA on your tax return, reducing your taxable income for that year. When you deposit money into an HSA, it's typically with untaxed dollars.
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