You may wonder what sunscreen and shades have to do with your HSA. Well, those are just two of the many items that are HSA-eligible expenses. With summer around the corner, you may want to prepare for fun in the sun by tapping into your HSA to cover sun-protection costs. Your HSA is the only tax-advantaged account that allows you to save using pre-tax dollars and allows you to spend tax-free for qualified medical expenses. So, avoid sunburn and use your HSA for sunscreen, prescription sunglasses and SPF 15+ lip balm.
In order to use your HSA, you must contribute to the HSA. We are almost halfway through the year and the IRS allows you to save up to $3500 if you are covered as an individual on your health plan or $7,000 if you have family coverage. You can contribute another $1,000 if you are lucky enough to be over 55 years old.
Remember, any money deposited into your HSA by you or your employer is yours to keep…forever. The funds roll over every year and as long as you use the funds to pay for qualified medical expenses, you won’t pay tax on that money.
You can change your contribution to your HSA at any time. Situations that often trigger the need to modify a contribution level include marital/family status change, beginning/ending a treatment or medication, need for catch-up contributions, etc. Talk with your payroll department to make a change.
The list of qualified medical expenses is quite extensive and can be found here. Remember, if you have any questions; please speak with your tax advisor as this information is not tax advice. Enjoy your summer and remember that GRB is Here. For You.