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HSA Questions (relating to spouse over 55, separate accounts)
Old 01-14-2014, 08:28 AM   #1
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HSA Questions (relating to spouse over 55, separate accounts)

I have an HSA account in my name through HSA Bank and roll almost all the money into a TD Ameritrade account, where it is invested. I have never made a withdrawal.

My wife turned 55 last year (I'm a few years behind her). As near as I can tell, we can't make the extra $1,000 deposit into my HSA account since I'm not 55, and joint HSA accounts don't exist. So, she would have to open one of her own. The savings in taxes net of fees would be about $175 for each $1,000 I put in.

Since the amounts would be small ($1,000 for 2013, $1,000 for 2014, then $1,000 every year after), I wouldn't plan to open a TD Ameritrade account. I'm thinking instead I would just withdraw the money. Do I need to have expenses after the date of the new HSA account to avoid a problem with the IRS or can I go back to the time when we first had a HDHP? Since we've had one for several years, and never made a withdrawal, there would be plenty of room for withdrawals.

Would appreciate any thoughts.
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Old 01-14-2014, 08:33 AM   #2
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Originally Posted by 45th Birthday View Post
Do I need to have expenses after the date of the new HSA account to avoid a problem with the IRS or can I go back to the time when we first had a HDHP?
As I understand it, you - or more accurately, your spouse - will have to have qualified expenses after the date her HSA policy becomes effective to stay in the good graces of the IRS.

All things HSA: http://www.irs.gov/publications/p969/ar02.html
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Old 01-14-2014, 08:51 AM   #3
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Why not open an HSA account in her name and deposit the entire year's deduction, including the catch-up? That way it will be enough to justify a second TD-A account and you can keep all the funds tax deferred.
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Old 01-14-2014, 10:01 AM   #4
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Originally Posted by REWahoo View Post
As I understand it, you - or more accurately, your spouse - will have to have qualified expenses after the date her HSA policy becomes effective to stay in the good graces of the IRS.

All things HSA: Publication 969 (2012), Health Savings Accounts and Other Tax-Favored Health Plans
Thanks, do you mean the HDHP or the HSA account itself? The plan has been around for quite some time.
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Old 01-14-2014, 10:04 AM   #5
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Why not open an HSA account in her name and deposit the entire year's deduction, including the catch-up? That way it will be enough to justify a second TD-A account and you can keep all the funds tax deferred.
I've already made the deposits for 2013 and 2014. Also, that would still be doubling up on the fee HSA Bank charges for investments (not huge-$36/year), and I would have another small account out there to look at.
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Old 01-25-2014, 11:58 AM   #6
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I've already made the deposits for 2013 and 2014. Also, that would still be doubling up on the fee HSA Bank charges for investments (not huge-$36/year), and I would have another small account out there to look at.
True, but if you can afford to contribute the max plus catch-up to the account each year it will build quickly and the tax advantages of tax-free in, growth and out (for medical expenses) can't be beat by any other investment vehicle. You can even use it for Medicare supplement insurance once you reach age 65.
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