Your money in an HSA WILL keep rolling from year to year until you spend it on qualified expenses.

Per the note about being able to use an HSA post-retirement for non-medical expenses, that’s true. After age 65, you can use the money in an HSA for non-medical expenses, but it will be taxed. If it’s used for medical expenses, it’s not taxed. If you use it for non-medical expenses BEFORE the age of 65, you’ll be taxed AND incur a 10% penalty.

Per the note about using an HSA to pay for expenses you incurred before you set it up, that’s a no-go.

Clear as mud, right??

According to http://www.irs.gov/publications/p969/ar02.html#en_US_publink100038736

“The contributions remain in your account from year to year until you use them.”

Now, that’s probably a generic so you might want to double check your plan documents, but I’d venture to say you keep the money.

There’s an envelope in the desk labeled “Health Care Receipts 2009″ that contains all our receipts, with the health care item highlighted in bright yellow and circled in fine-point pen. : ) Don’t even get me started on how I keep track of my grocery receipts. I blame you; it’s all your fault.

Can you “lose” money in your HSA? If we don’t use it this year, doesn’t it roll over to next year? So how would we lose it? Are you scrambling to find expenses, or to fund it? I mean, if we don’t use it, there’s just that much more
for me to cut off my husband’s balls with!

Also, if you think about it, it really doesn’t matter if you submit everything (small and large) as you go b/c it’s pre-tax, use-it or lose-it. So, use it as long as it’s for things you’d need anyway. If you have extra expenses after your account has been spent, you’d have spent it anyway post-tax. And I KNOW that you’re someone who only buys stuff when needed!

We tend to over-estimate how much we’ll use for our HSA each year, then scramble at the end of the eligible period (often into the next calendar year, so check your plan!) for contacts… new glasses… an optional/overdue trip to the dermatologist or whatever. So you could make a “fluff” list JUST IN CASE you do have leftover funds. DON’T lose the money they’ve already withheld from you!

We never contributed the max, but even if you drop the insurance plan that the HSA was connected to, you take the HSA itself with you. You just can’t contribute anything additional to it anymore. So if you have $1,000 in the HSA when you drop the insurance, you still have $1,000 sitting there for your future use, whenever you need it. So that’s where we stand right now.

Each year you can make up to the max contribution, even if you have money left over from last year. Ideally, you stay on it forever and build up savings over time. At retirement, you can even use the money for non-medical expenses I believe. So it becomes kinda like a 401k at that point.

Do you mean that y’all have already contributed the max for the year? Is that why you can’t add anymore? From my understanding, and correct me if I’m wrong, but there’s an annual max that you can contribute, and that money can roll over to next year if you don’t spend it. Can you then re-contribute the max for next year, or does the rollover money count toward next year’s max? Does that make sense?

I was thinking I probably wouldn’t go back and try to recoup expenses before the account was opened and just work from here forward. With four people, we have a lot of annual visits (eight for the dentist - two for each family member, one vision for me plus corrective lenses, two well-child exams, and my annual, plus any sick visits). They add up fast.

Throw in Joshua’s crown (or mine, two years ago) and Mary Judah’s ER visit, and wow. There you go. We’re also trying to save up for a vasectomy, which I was hoping we could do this year, but I don’t know if we can at this point.