What Happens if I Use My HSA Card to Pay for No Show Fees?

Using your HSA card to pay for no show fees can have consequences that you need to be aware of. When you use your HSA card for expenses that are not considered eligible medical expenses by the IRS, such as no show fees, you risk facing penalties and tax implications. It's important to understand the rules and guidelines surrounding HSA funds to avoid any issues.

If you use your HSA card for non-qualified expenses like no show fees:

• You may have to pay taxes on the amount used for non-eligible expenses.
• You could also incur a 20% penalty on the non-qualified expense amount if you are under 65 years old.
• If you're 65 or older, you will still need to pay taxes on the non-eligible expenses, but the penalty is waived.

When it comes to managing your HSA funds, using your HSA card to pay for no show fees can lead to unwanted complications. This type of expense is not recognized as an eligible medical expense according to IRS guidelines, and therefore should be avoided to maintain compliance.