Some people look at the HSA similarly to an IRA, contributing tax-deductible dollars today to be accumulated and withdrawn in retirement. Thus, it should be treated as a tax-deferred asset for property division purposes. This type of account should be added to your fact-finder or asset/liability checklist.

How do I get Form 8889?

IRS Form 8889 can be downloaded from IRS.gov at any time. IRS Form 5498-SA is typically available around the end of January. If you contribute in the new year for the previous tax year, you will also get another 5498-SA form in May.

What is needed for a health savings account?

Under the law, an eligible individual: Must be 18 years of age or older. Must be covered under a qualified high-deductible health plan (HDHP) on the first day of a certain month. May not be covered under any health plan that is not a qualified HDHP.

Can an individual set up a health savings account?

Yes, you can open a health savings account (HSA) even if your employer doesn’t offer one. But you can make current-year contributions only if you are covered by an HSA-qualified health plan, also known as a high deductible health plan (HDHP).

What can I use a health savings account for?

Paired with a qualified HDHP, an HSA allows you to contribute pre-tax earnings to a federally insured savings account. The funds can be used for current medical expenses or saved for the future. Your HSA belongs to you, and the money in your account stays with you year-to-year, through job changes and into retirement.

Do I need a tax form for my HSA?

You must report contributions from your HSA on IRS Form 8889. Get 5498-SA information here. There’s a sample 5498-SA form from the IRS here.

Who is not eligible for HSA?

HSA Eligibility You are not enrolled in Medicare, TRICARE or TRICARE for Life. You can’t be claimed as a dependent on someone else’s tax return. You haven’t received Veterans Affairs (VA) benefits within the past three months, except for preventive care.

What does it mean to have a health savings account?

Health Savings Account (HSA) A type of savings account that lets you set aside money on a pre-tax basis to pay for qualified medical expenses.

Can you earn interest on a health savings account?

An HSA may earn interest or other earnings, which are not taxable. Some health insurance companies offer HSAs for their HDHPs. Check with your company. You can also open an HSA through some banks and other financial institutions.

Can a HSA be used for medical expenses?

While you can use the funds in an HSA at any time to pay for qualified medical expenses, you may contribute to an HSA only if you have a High Deductible Health Plan (HDHP) — generally a health plan (including a Marketplace plan) that only covers preventive services before the deductible.

How much money can you put into an HSA?

For 2020, if you have an HDHP, you can contribute up to $3,550 for self-only coverage and up to $7,100 for family coverage into an HSA. HSA funds roll over year to year if you don’t spend them.