HSA experts?

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  • phylodog

    Grandmaster
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    59   0   0
    Mar 7, 2008
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    Arcadia
    So I just dropped almost $600 for a device that assists me in cocking my crossbow. With my shoulder getting worse I discovered last week that I was unable to cock it manually any longer. Going over some dental bills got me thinking about my HSA which got me wondering.... Can I reimburse myself for this purchase out of my HSA as a medical device? I'm not trying to pull a fast one or poke the tiger (IRS) but I could sure use that $600 for other things at the moment and as far as I'm concerned giving up hunting is not an option and I can't hunt without it.

    Who are the experts when it comes to this type of question? Doctor? Insurance Co? Bank with the HSA? Accountant? I'm not sure who to ask.
     

    chef1231

    Expert
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    Apr 23, 2014
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    Sounds like a good questions for your HR dept assuming you have one that is worth anything. I know you can reimburse yourself for things. You can you your HSA for a lot of things I would think that a device for a crossbow is not one of them. I would just call the IRS and ask them. ( from a burner phone ) LOL
     

    BugI02

    Grandmaster
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    Jul 4, 2013
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    Columbus, OH
    Hola, phylo

    Full disclosure, I have
    zero expertise in this area. Given that, I'm thinking start with the Doctor who treats/treated your shoulder and ask whether they think such a device would be covered by insurance and how it might be coded. Then maybe insurance company for a ruling on the Dr's opinion. If you can build a good case that such a device would be covered medically as an assist device i think you could confidently reimburse yourself, keeping all the correspondence for future reference in case the IRS has any questions
     

    D K

    Marksman
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    4   1   0
    Apr 10, 2010
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    There’s a finite list of items/products/services that are approved for purchase via HSA. Its usually a google search away (I’ll look for it and post shortly). Claritin? Nope, not without a prescription. Viagara? Yep! (With a script).

    That device which you seek could be considered to be a brace or an aid, but would need to start as a prescribed device, its just a matter of finding the MD who will prescribe it (maybe he’s here)!

    I always thought the Commando crossbow From 007 (For Your Eyes Only?) was a cool tool, there must’ve been some flaw for that integrated cocking to have not caught on, but would think that sort of crossbow could be easier to cock than most.
     

    JettaKnight

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    Oct 13, 2010
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    Who are the experts when it comes to this type of question? Doctor? Insurance Co? Bank with the HSA? Accountant? I'm not sure who to ask.
    None of the above. It's an IRS question.

    So I just dropped almost $600 for a device that assists me in cocking my crossbow. With my shoulder getting worse I discovered last week that I was unable to cock it manually any longer. Going over some dental bills got me thinking about my HSA which got me wondering.... Can I reimburse myself for this purchase out of my HSA as a medical device? I'm not trying to pull a fast one or poke the tiger (IRS) but I could sure use that $600 for other things at the moment and as far as I'm concerned giving up hunting is not an option and I can't hunt without it.

    Honestly, that's an item I've never run across.

    My first inclination is "no". It could be construed as an item that simply makes a task easier, not necessarily a medical necessity. If you can say that this device is akin to a wheelchair - i.e. a device that makes your life easier to work around a disability, then it could be OK.


    However, remember that any past medical expense that you paid out of pocket since you started you HSA can be reimbursed to you - even it was made for a family member not covered by your high deductible insurance.

    Example: I opened an HSA in 2016, my wife paid for her cavity filling in 2018 using a credit card, I can now remove funds from my HSA equal to amount. But do keep good records of that.

    Phylodog, your withdraw of $600 isn't likely to draw attention from the IRS (my plan of withdrawing ten of thousands after I retire certainly is). If you have some other old receipts or out-of-pocket payments as a backup excuse, then I'd hesitantly say go for it.

    EDIT: The safest way is to get an MD (or DO) to give you a Letter Medical Necessity for this device.


    And I'd be remiss if I didn't tell everyone viewing this: If you have an HSA, always, always, always make the maximum contributions each year; preferably through your paycheck. (yes, fund your HSA before even your 401K, IRA, etc.)
     
    Last edited:

    AtTheMurph

    SHOOTER
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    Jan 18, 2013
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    ** I do not give tax advice **

    You can use your HSA to buy anything you like. Now whether or not is qualifies for tax free distribution rules is another matter. And if you do use your HSA to purchase something that the IRS does not allow they will have to find it and call you on it.

    I can tell you with almost 100% certainty that I do not believe that the item you describe will qualify. I can also tell you with almost 100% certainty that the IRS will never look at it.

    The real question is honesty over tax savings?
     

    maxwelhse

    Grandmaster
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    Aug 21, 2018
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    yes, fund your HSA before even your 401K, IRA, etc.)

    I'd like some additional clarity on that point as I'm doing it almost exactly backward. I put into my 401k beyond when it hurts and almost nothing into my HSA since I don't usually need much medical care.

    I'm not arguing, I'm just too ignorant to know why I'd want to do it the other way around.
     

    Clark & Addison

    Plinker
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    Feb 28, 2019
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    Gibson County
    many of my partners fully fund HSA and then pay cash for medical expenses. they then invest HSA as another IRA vehicle.

    This is what we do (we do save our receipts so that we can withdraw later if needed). At age 65, HSA funds essentially become a Traditional IRA (funds can be withdrawn for non-medical expenses without penalty, but you'll still have to pay taxes). The advantage over the Traditional IRA is that you don't have to pay social security taxes on the money invested.
     

    Clark & Addison

    Plinker
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    Feb 28, 2019
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    Gibson County
    Wait... Is my HSA an IRA right now, pre-65? I thought it was literally just a savings account?

    Essentially yes (as long as you want it to be). At my employer our HSA can only be payroll deducted to one credit union. When the money is there it is in a savings account. Once a year I rollover the money to a Fidelity HSA that can be invested and held until retirement.
     

    maxwelhse

    Grandmaster
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    Aug 21, 2018
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    Michiana
    Essentially yes (as long as you want it to be). At my employer our HSA can only be payroll deducted to one credit union. When the money is there it is in a savings account. Once a year I rollover the money to a Fidelity HSA that can be invested and held until retirement.

    I see the light! That makes all the sense in the world now.

    So if I've got all of the pieces of the puzzle now, your HSA can be an IRA that is social security tax-free?
     

    maxwelhse

    Grandmaster
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    That is correct (although it's still technically an HSA, but acts just like an IRA but saves you the social security taxes).

    I can see why Jetta is so passionate about people fully funding their HSAs before 401Ks. If my math is right, that's around a 7% bump just from the lack of SS taxes.

    Thanks for the insight! I had been planning to put a little more toward my HSA anyhow, but now I think I'll turn the heat up.
     

    JettaKnight

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    Wait... Is my HSA an IRA right now, pre-65? I thought it was literally just a savings account?

    It's better than a savings account; and better than any retirement account!

    1. Money goes in pre-tax
    2. Money from payroll deductions goes in pre-FICA
    3. Money, grows, and if paying for medical expenses, comes out tax free

    Any retirement account will only give you (1) or (3).

    Plus, if you need money now (queue J.G. Wentworth), I can take it out to reimburse myself for past expenses from my box of receipts. With a 401K, or IRA, I'd be paying penalties (I'm in my 40's).

    After I retire, I'll probably use it for medical expense then (getting old is expensive). Or, I could take it all out at one time and buy a boat - provided I have old receipts to compensate. There's no rules on withdraw amounts like there is with a 401K.


    Or, you can treat it like an IRA and take the money out and pay income taxes after 65. (before then you get a penalty fee)




    Really, your payroll department should be able to deposit to any bank, just like direct deposit. I chose one with good investment options and no fees - HSA Bank - they tie in with TDAmeritrade, so I have complete access to the stock market.


    The downside is, the amount you can deposit goes up each year, but certainly hasn't kept up with the ridiculous rate of deductibles.
     

    maxwelhse

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    The biggest disconnect I had here is that I can put that money from a savings account into something useful to earn interest.

    Rest assured, I'll be after the max on it now. I was looking to top my 401K out in the next year or two, but I believe I'll put that effort to the HSA now. Plus then if something bad does happen with my health, I have HSA money to burn too, right?
     

    Cameramonkey

    www.thechosen.tv
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    May 12, 2013
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    ** I do not give tax advice **

    You can use your HSA to buy anything you like. Now whether or not is qualifies for tax free distribution rules is another matter. And if you do use your HSA to purchase something that the IRS does not allow they will have to find it and call you on it.

    I can tell you with almost 100% certainty that I do not believe that the item you describe will qualify. I can also tell you with almost 100% certainty that the IRS will never look at it.

    The real question is honesty over tax savings?

    This is probably the most honest and realistic, practical answer. You'll only get dinged if you are audited for something else and they notice it. I know people who have used the HSA for other "questionable" (yet closer to true medical need, like physical therapy equipment) items. I wouldnt sweat it.
     
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