USGrant1962
Thinks s/he gets paid by the post
I just stumbled upon a quirk in HSAs that didn't know. While they are one of the most tax-advantaged accounts in life, they are one of the worst in death. HSA accounts are fully taxable to the non-spouse beneficiary in the year of death.
So as you age, blow that HSA dough!
https://www.irs.gov/pub/irs-pdf/p969.pdf
So as you age, blow that HSA dough!
Spouse isn’t the designated beneficiary. If your
spouse isn’t the designated beneficiary of your HSA:
• The account stops being an HSA, and
• The fair market value of the HSA becomes taxable to
the beneficiary in the year in which you die.
If your estate is the beneficiary, the value is included on
your final income tax return.
https://www.irs.gov/pub/irs-pdf/p969.pdf