And it can be used at any time in the future. Once you add money to your HSA, it’s yours. You cannot be reimbursed for expenses that were incurred prior to that date.ĭid you know that you can also reimburse yourself for expenses even if you are no longer eligible to contribute to an HSA? That’s because the use of your funds is not tied to HSA eligibility. This is one of the reasons why knowing the exact date of the establishment of your HSA is important. And that the expense was not reimbursed in any other way. The only rule is that your HSA was established at the time that the expense was incurred (date of service). When can I reimburse myself for an out-of-pocket expense? Keep reading to learn how HSA distributions are taxed and reported. If there’s something that doesn’t match between forms 1099-SA and 8889, resolve it before filing your taxes. You should be prepared to file Form 8889 with your annual taxes. If you take a distribution your HSA provider will send you Form 1099-SA. When you choose to be reimbursed for an eligible medical expense that’s called a distribution. The medical expenses had not been taken as an itemized deduction in any year.Qualified medical expenses had not been paid or reimbursed from another source, and.Distributions were to pay or reimburse qualified medical expenses,.

In case of an IRS audit, you need to have records that prove: You should also keep receipts for all products or services you paid for. This documents the expenses for services covered under your High-Deductible Health Plan (HDHP). It’s best to save a copy of your health insurance carrier’s Explanation of Benefits (EOB) in case the IRS audits you. This is helpful if you plan on paying for out-of-pocket expenses and reimbursing yourself “20 years” from now. Some HSA companies (like Lively) offer digital receipt filing so you can document your receipts without having to save piles of receipts. Receipts should be kept for as long as your tax return is open and subject to an audit usually three years. To justify spending money on a qualified medical expense, you should keep or track your expense receipts. Then you have the option to reject or submit them⁠-with receipt-for reimbursement, now or later. Expense Scout prompts you to a list of expenses for review. Like your personal debit card or credit cards. Instead, use Lively’s Expense Scout to scan and alert you of potential HSA-eligible expenses from linked external accounts. Expense Scoutĭon’t spend your time scanning receipts trying to find your HSA-eligible medical expenses. Better yet let Lively’s Expense Scout do the searching for you. Use “ What’s Eligible” to find qualifying medical expenses without the requirement of a doctor’s note, with a prescription, or with a doctor’s letter. But what about over-the-counter products like sunscreen, prenatal vitamins, or contact lens cleaning solution? Expenses are likely pretty obvious if you’re at the doctor’s, having an eye exam, or at a dentist appointment. There are thousands of HSA qualified medical expenses. Know what qualifies as an HSA-eligible medical expense

And while it isn’t required that you submit receipts to be reimbursed from your HSA, we recommend it in case of an IRS audit. Paid for a medical expense out-of-pocket? What’s next?Īs long as the qualifying medical expense was made after the establishment of your HSA, you can use your HSA to pay yourself back for your out-of-pocket expense. Whether you reimburse yourself now⁠-or later⁠-has some interesting benefits. This can be done even if you don’t have money in the account the day the expense incurred, and at any time in the future. What does it mean to “reimburse” yourself with your Health Savings Account (HSA)? It means paying out-of-pocket for an HSA-qualified medical expense and then using money from your HSA to pay yourself back. You can either 1) swipe your Lively Visa debit card at the time of purchase, or 2) reimburse yourself later.

When you have a medical expense there are two ways of paying.

Hsa eligible expenses