When Can I Use Money from HSA?

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Qualified medical, OTC, and long-term care

If you have an HSA (Health Savings Account), you may be wondering when you can use the money in it. An HSA is a valuable savings tool that allows you to set aside pre-tax money for medical expenses. Here's a guide on when and how you can use the funds from your HSA:

1. Qualified Medical Expenses:

• You can use the money in your HSA to pay for a variety of medical expenses, including doctor visits, prescription medications, dental care, vision care, and more.
• Expenses that qualify are outlined by the IRS in Publication 502, so be sure to consult the list to see what is covered.

2. Over-the-Counter (OTC) Medications:

• With the passage of the CARES Act, you can now use HSA funds to purchase over-the-counter medications without a prescription.
• This includes items such as pain relievers, cold medicine, allergy relief, and more.

3. Long-Term Care Expenses:

• If you require long-term care services, you can use your HSA funds to cover these costs.
• Long-term care insurance premiums are also considered a qualified expense.

HSA use after 65 and savings rollover

4. Retirement Savings:

• Once you turn 65, you can withdraw money from your HSA for non-medical expenses without penalty, although income tax may still apply.
• Using your HSA as a retirement savings vehicle can provide additional financial security in your golden years.

5. General Savings:

• If you have funds leftover in your HSA at the end of the year, they roll over into the next year and continue to grow tax-free.
• You can use this money for future medical expenses or let it accumulate for even greater savings.

Recordkeeping and overall guidance reminders

Remember to keep receipts and documentation for all HSA expenses to ensure compliance with IRS guidelines.

If you're looking to make the most of your HSA, it’s essential to understand when and how you can access those funds. An HSA not only helps you save for current medical expenses but also serves as a powerful tool for your future financial health.