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I have past medical expenses that I could not pay with HSA money since I ran out of HSA funds. That is, I maxed out what I could contribute for the year and used it for other medical expenses. I understand that I can still get a tax credit to lower my income by putting money into my HSA and then pulling it out for the medical expenses. When filing my taxes I indicate this amount thus lowering my tax liability. My question is, can I pay for these past medical expenses with HSA funds even though when I start my new job I will have decent medical insurance? That is I no longer qualify for an HSA. Must I take care of these past medical expenses before I start my new job? Thanks, Mike

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HSA funds can be used to pay for past medical expenses, as long as you already had the HSA in place before the medical expense was incurred. So if you establish the HSA and then incur a medical expense, but your HSA does not have enough money in it to pay for the HSA, you can wait until you do have the money in the HSA and then pay for that expense. But any expense that was incurred before you established your HSA is not eligible to be paid for from your HSA.

Money that is in the HSA is yours to keep until you spend it, and you can continue to use the HSA money even if you become no longer eligible to contribute new money into your HSA. So when you start the new job that will make you no longer HSA eligible, you won't be able to add money to your HSA, but you can use up the money that is already in the HSA.

If you haven't already contributed up to your HSA contribution limit for last year and you haven't filed your taxes yet, you have until April 15 of this year to make contributions for last year.

Keep in mind that for the year that you start your new job, your HSA contribution for that year is prorated based on the number of months of the year that you were HSA eligible. See this answer for more information on how to prorate your contribution limit.

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