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60 votes

Is it mandatory to have health insurance?

The individual mandate is still in effect for 2018, which means you have to have qualifying health coverage or pay a fine--I can't find the penalties for 2018 but for 2017 it was the greater of 2.5% ...
Craig W's user avatar
  • 15.9k
46 votes

Are the HSA and FSA bad deals?

So who are these accounts for? What kind of person would look at an FSA or HSA account and think, "that's a great deal"? FSA: Those who have recurring expenses, or planned procedures this ...
TTT's user avatar
  • 47.2k
36 votes

What happens if you violate an IRS limit by less than 50 cents?

I don't know the answer to your question. But let me offer these thoughts: First, when it comes to over contributing to an HSA, you cannot just "pay the penalty" and be done with it, ...
Ben Miller's user avatar
  • 116k
33 votes
Accepted

If I use HSA to make an emergency payment for rent, how would I inform the IRS of that?

You'll attach form 8889 to your tax return, the specific parts you'll need to fill are in Part II of the form (line 17).
littleadv's user avatar
  • 176k
23 votes
Accepted

Put lump sum into HSA

If you go the route of transferring money from your bank account to the HSA, the money will still have been taxed for FICA. The only way to skip this is to go directly from the paycheck. Another way ...
mhoran_psprep's user avatar
22 votes

Can I close my money in HSA and transfer it to another bank account and use it for non-medical purpose?

When you put money into the HSA, you didn't pay any tax on that amount. Now that you want to take money out, if you don't have any medical expenses to offset the amount you are withdrawing, you will ...
Ben Miller's user avatar
  • 116k
21 votes
Accepted

Minimizing medical costs with HSA

There's an annual contribution limit, for 2019 it is $3,500 single/$7,000 family. Otherwise, it's fine to match future contributions to prior or planned qualifying expenses so long as the account was ...
Hart CO's user avatar
  • 70.5k
20 votes
Accepted

Is it worth saving HSA funds until retirement?

Yes, absolutely. The HSA, when used for medical expenses, allows you to essentially pay for your medical expenses tax free. Even if you don't have extra room in your budget, you can fund the HSA as ...
Ben Miller's user avatar
  • 116k
20 votes
Accepted

Should I prioritize my 401(k) over my student loans?

Purely financially, giving up the employer match is hard to argue. It's mathematically a free 100% return, but you can't get to it for many years. So it's a great benefit for the future. On the ...
D Stanley's user avatar
  • 136k
20 votes
Accepted

Can I afford to take this job's high-deductible health care plan?

My opinion is that, in general, the HDHP+HSA is usually a better option for both the employee and employer than a traditional health plan. But of course, the details vary. Besides knowing the premium ...
Ben Miller's user avatar
  • 116k
18 votes

Is it mandatory to have health insurance?

I see this sort of misconception flying around. "Well the health insurance takes my money, makes a profit, and pays me only if I need it, otherwise I 'lose' money. Clearly, I would be better off ...
Alexander's user avatar
  • 1,131
18 votes
Accepted

What is the purpose of putting funds into an HSA when the interest rate is so low?

The HSA for most people, is a way to take pretax money and be able to use it for healthcare. No 7.5%/10% floor or need to itemize taxes in any way. It’s available based on the health plan you have, ...
JTP - Apologise to Monica's user avatar
17 votes

Are the HSA and FSA bad deals?

For FSA, true, only someone who is a good planner should participate. Otherwise, you run the risk of losing unused money at the end of the year. Good planners can start with health categories that are ...
Orange Coast- reinstate Monica's user avatar
16 votes
Accepted

Can I reimburse medical expenses using funds added to HSA in a later year?

Yes. From the IRS: You can receive tax-free distributions from your HSA to pay or be reimbursed for qualified medical expenses you incur after you establish the HSA. So the key date is when you ...
Craig W's user avatar
  • 15.9k
15 votes

What happens if you violate an IRS limit by less than 50 cents?

What's going to happen if I just ignore this? Will someone eventually come after me for taxes, penalties and interest due on my overcontribution of 8¢? I expect nothing. If all your numbers on the ...
littleadv's user avatar
  • 176k
14 votes

Is it worth saving HSA funds until retirement?

Is it worth saving HSA funds until retirement? Yes Are there pros and cons from a tax perspective? Mostly pros. This has all of the benefits of an IRA, but if you use it for medical expenses ...
NL - Apologize to Monica's user avatar
14 votes
Accepted

Can I pay myself back later in the year if my HSA doesn't have adequate funds earlier in the year to pay for an expense?

Can I pay myself back later in the year if my HSA doesn't have adequate funds earlier in the year to pay for an expense? Yes. You can request a distribution for any qualified medical expenses that ...
Hart CO's user avatar
  • 70.5k
13 votes

When is an HSA expense "incurred"?

There are a couple of specific criteria in the HDHP / HSA relationship. You must be enrolled in an HDHP in order to contribute funds to an HSA on a tax preferred basis. You do not need to be ...
quid's user avatar
  • 49k
13 votes

What is a deductible?

Broadly, it means that you'll be responsible for the first $3,000 of medical expenses that you incur over the course of the year before insurance kicks in. There may be a co-pay as well where you're ...
Justin Cave's user avatar
  • 27.3k
13 votes

Does an HSA have to be used exclusively for medical expenses

I just want to point out that your question implies a misunderstanding, even though you didn't explicitly mention it: I had an HSA last year. This year I have health insurance through ACA. The ...
TTT's user avatar
  • 47.2k
12 votes

If I make an out of pocket medical payment on my normal credit card, can I withdraw that amount from my HSA?

Yes, you certainly can. As long as you incurred the expense while you had the HSA account in place, you can pay for the expense in any way you please, and reimburse yourself later for that expense out ...
Ben Miller's user avatar
  • 116k
12 votes
Accepted

Is it possible to use my HSA for a payment I've already made?

Yes, you can be reimbursed through your HSA account; see for example NerdWallet's article. Best is to see your own provider's website, of course, but HSA rules in general allow for reimbursement for ...
Joe's user avatar
  • 35.8k
12 votes

Does an HSA have to be used exclusively for medical expenses

If you want the tax benefits of the funds, yes, they must be used for qualified medical expenses as defined by the IRS. You can withdraw funds whenever you want, for any reason, but if they are not ...
LunarGuardian's user avatar
12 votes
Accepted

Why are excess HSA/IRA/401k/etc contributions allowed?

Some institutions enforce the limits, some don’t. However, one aspect that you may not realize is that they really don’t know what your contribution limits are. Lots of things affect your contribution ...
Ben Miller's user avatar
  • 116k
11 votes
Accepted

Why do HSA qualifying plans have a max deductible?

The government wants to encourage everyone to buy health insurance, because with more healthy people buying health insurance, the rates can be reduced for those that are less healthy. Ask yourself ...
Ben Miller's user avatar
  • 116k
10 votes
Accepted

Can I use an HSA as investment vehicle by overcontributing temporarily?

What you are describing doesn't work. The reason is that when you do an excess contribution withdrawal, your HSA custodian will also send you any earnings from your excess contributions. These ...
Ben Miller's user avatar
  • 116k
10 votes
Accepted

HSA distributions and tracking receipts

The presenter suggested we keep records of our claims for 10+ years in paper form. This seemed to be overkill. It would be overkill if you're taking distributions regularly and you have enough valid (...
TTT's user avatar
  • 47.2k
10 votes

Does an HSA have to be used exclusively for medical expenses

Yes, it must be for a qualified medical expense. Qualified medical expenses are those expenses that generally would qualify for the medical and dental expenses deduction. These are explained in ...
user1723699's user avatar
  • 2,113
10 votes
Accepted

Opening an FSA with dormant HSA

Participation in the FSA will make you ineligible to contribute new money to the HSA. However, the money that you already have in the HSA is yours to keep until you use it. There is no time limit for ...
Ben Miller's user avatar
  • 116k
10 votes

Put lump sum into HSA

Yes, you can contribute a lump sum to your HSA, either in cash, or a one-time transfer from an IRA, both of which are governed by the annual limits. They will make your tax return a little more ...
D Stanley's user avatar
  • 136k

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