Do HSAs Expire? Understanding the Lifespan of Health Savings Accounts

Health Savings Accounts (HSAs) have become a popular tool for saving and paying for healthcare expenses. One common question that many people have about HSAs is whether or not they expire.

Here's what you need to know about the expiration of HSAs:

HSAs do not expire as long as the account holder is alive. This means that you can continue to use your HSA funds for eligible medical expenses indefinitely.

However, there are a few important points to keep in mind:

• If you no longer have a High Deductible Health Plan (HDHP), you are not eligible to contribute to your HSA, but you can still use the funds that are already in the account.
• Once you turn 65 and enroll in Medicare, you can no longer contribute to your HSA, but you can still use the funds for qualified medical expenses tax-free. If you use the funds for non-medical expenses after turning 65, you will incur income tax on the withdrawal, similar to a 401(k) distribution.
• If the HSA account holder passes away, the funds in the account become the property of the beneficiary. The beneficiary can use the funds tax-free for qualified medical expenses.

It's important to keep track of your HSA contributions and use them for eligible expenses to maximize the benefits of your account. Remember that HSAs offer a triple tax advantage: contributions are tax-deductible, earnings grow tax-free, and withdrawals for qualified medical expenses are tax-free.

Health Savings Accounts (HSAs) serve as a versatile savings tool when it comes to managing healthcare costs, and the good news is that these accounts don’t expire as long as you’re alive! This makes them a fantastic way to set aside funds for future medical expenses.