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Old 04-13-2017, 07:01 PM   #21
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It doesn't work that way. You take the money out directly to yourself. On your tax forms you declare how much you withdrew and how much of it was for eligible medical expenses. The IRS could audit you, or not, same as any other tax related claim.
Yeah, I wouldn't use an HSA credit card or write a check from the account (if that's even an option) to a car dealer. I'd transfer it to my account, using the past receipts as justification if the IRS asks. Where the money goes is immaterial, because it's just a delayed payment on those receipts.
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Old 04-13-2017, 07:23 PM   #22
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My HSA limits how much you can put on the credit card they provide. I learned this the hard way when I tried to use it to pay for my son's surgery last year... (which we paid for out of pocket because of high deductible insurance.) After the 3rd attempt to pay online (and getting rejected) I called the HSA and they explained. So I paid them with other funds, then reimbursed myself.
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Old 04-14-2017, 12:15 AM   #23
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Are you stressed a little about the backlog? It would sure bug me to have 30k worth of receipts waiting for me in the future.

Maybe start "paying them off" a few each year so you could begin throwing some away. You could whittle away at the pile over time. Put the cash in your Roth or tax free bonds if you still need the tax free growth.
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Old 04-14-2017, 01:47 AM   #24
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I have never taken money out of my HSA. I save receipts and take pictures of them annually, I write out the expenses in black marker on yellow paper for each year, total it, and take a picture of that piece of paper, also.

If I had a bigger account or if I was still able to contribute more to the account, I would do something more efficient. But it is only about $30K which I will easily spend, even if just on Medicare Part B and Part D.

NOTE: Many receipts fade to nothing over time. This has even happened within a year. So scanning or photos is really necessary.

Someone mentioned high investment expenses ... fortunately, I have HSA bank, my fees are fixed at about $66/year. I can invest in Vanguard ETFs in the associated TD Ameritrade brokerage account at zero cost, they have a program for no-fee ETFs. So, for my account balance, that is an ongoing fee of about 0.25% per year (which is not nothing, of course). At some point, before I ever touch my ROTH, I will probably take it all out in one year ... perhaps in my early 70's.
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Old 04-16-2017, 01:54 PM   #25
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Im still in the stone age. All of my bill receipts are stuffed in an envelope that says "HSA receipts" in my file cabinet. Would suck if my house burned down, I suppose.
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Old 04-16-2017, 02:34 PM   #26
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Are you stressed a little about the backlog? It would sure bug me to have 30k worth of receipts waiting for me in the future.

Maybe start "paying them off" a few each year so you could begin throwing some away. You could whittle away at the pile over time. Put the cash in your Roth or tax free bonds if you still need the tax free growth.
Not really for us, because I expect to use the HSA to pay (reimburse) Medicare premiums between ages 65 and 70 when we start to draw SS. I'm assuming that will basically drain our HSAs. If not, we'll just continue to reimburse for Medicare until it does, and/or cover current medical expenses such as eye care, dental, etc.

We're in contribution mode right now, and once we can't contribute and get the tax break anymore, we'll start reimbursing current medical expenses.

That's the plan, although I'm still saving receipts "just in case.
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Old 04-16-2017, 04:09 PM   #27
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This is a more pressing matter for those of us who sock money away in an HSA and plan to take it out well down the road, allowing for tax-free appreciation in the meantime.

That is my strategy. I have about $80K in an HSA Bank/TD Ameritrade account. About $58K in contributions, $22K in appreciation.

I've been copying receipts to get them a uniform size and also so that any on odd paper will not fade. They are all in a folder.

This thread makes me realize I need to do something better to insure backup way in the future when I start withdrawing the funds.

A wrinkle that has been in the back of my mind but haven't given much thought to is the rule about not being able to deduct medical expenses you used HSA funds to pay for. What happens if you have deducted medical expenses in some years and not in others? Long into the future, you reimburse for those from the HSA? Also, what about the portion of medical expenses that represents 10% of AGI that cannot be deducted? Can that amount be taken from the HSA?
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Old 04-16-2017, 04:52 PM   #28
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I'm savings them for implants. I need my teeth in the future. They won't be cheap, I don't need to stress over little receipts.
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Old 04-17-2017, 02:45 PM   #29
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We have never pulled money out of HSA. We keep paper receipts and electronic copy of summary EOB's from our insurance providers.

While I have no plan to pull money out anytime soon, most of our medical costs are ahead of us. Even if all my receipts got destroyed, I am pretty sure I will spend the balance and more in the future.
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Old 04-17-2017, 03:20 PM   #30
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I agree, if you use an HSA account for this kinda stuff, you need records.



If you use it to pay eligible expenses as they occur directly to the providers it's all right there in their records. You pay yourself you better have good records.


The only time we used the HSA was for my son's arm surgery in 2014. There was no easy way to pay the doctor directly. So I paid myself and kept it with a record of what we paid the doctor.
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Old 04-17-2017, 05:45 PM   #31
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I just keep a paper file of receipts that weren't paid by the HSA. Got about $30k worth. Not bad for a 45 year old

When I do reimburse myself for a medical expense I always pay with my cash back credit card, then reimburse myself with the HSA. Every little bit helps!
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Old 04-18-2017, 06:59 AM   #32
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My HSA has an online tally of all my expenses. While it doesn't go into deep detail, it will show " $X for Y Pharmacy". Wouldn't a printout of that be enough in the event of an audit?

Regardless, we keep our paper receipts in an annual folder which is then placed with our completed tax forms/returns for each year.
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Old 04-18-2017, 09:52 AM   #33
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My HSA has an online tally of all my expenses. While it doesn't go into deep detail, it will show " $X for Y Pharmacy". Wouldn't a printout of that be enough in the event of an audit?
This is what I keep. It shows "normal" health expenses for us like prescriptions and labs and so on. Stuff that makes sense. It also shows what insurance paid, so we don't accidentally include that.

We also pretty much route everything though insurance so that they can pay what they are willing to pay.

And frankly, there is so low a chance of an audit on this stuff I don't worry about it. The last figure I saw was 0.84% of all taxpayers.
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Old 04-18-2017, 10:04 AM   #34
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We are looking for every possible deduction at our high marginal rate, so we're in the camp of maxing the HSA contribution every year but withdrawing/reimbursing nothing. Plan to use it down the road in ER and/or Medicare premiums. Worst case, use it on non-eligible expenses and it gets treated as regular income (at a likely much lower marginal rate).

We scan all the HSA-related receipts and shred the original paper. They are simply stored in a Windows folder structure along with all other receipts -- receipts\2017\HSA Receipts (or receipts\2017\Payee Name for most receipts). The whole thing is backed up to the cloud in real time.
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