HSA Question

[Colorado Newbie]

I just got a call from a client that I set up on a HSA. His question that I was unable to answer is as follows: His policy has been in force since December 2007. Since then he has spent roughly $600 in health care cost. He has yet to open a HSA account. and wants to know if he opens his HSA account today and puts in lets say $2500 into the account, can he now withdraw $600 from the HSA account as though he just paid the doctors, so in other words now he has a total of $1800 left in the account.

thanks for your feedback

 

[moonlightandmargaritas]

No, but nice try. Any expense incurred before he opened the account is not eligible.

 

[Crabcake Johnny]

I'd actually like further clarification on that. An eligible expense incurred before the plan went into effect would be a no-go. However, his plan was indeed in effect when the expenses were incurred and you are allowed to back-fund your HSA account.

This might be one of those "better to ask forgiveness" situations where the only way he'd be "caught" is if audited. Slim to zero chance of that.

 

[somarco]

medical expenses incurred before the date your HSA is established cannot be reimbursed from the account.

For clarification purposes, the HSA cannot be established until the qualified HDHP is in place. You are allowed to establish the HSA at any time, but you are not required to fund it.

Once you establish the HSA you have until April 15th of the following year to actually FUND the account.

You may receive reimbursement for expenses incurred AFTER the HSA is established even if the HSA is not yet funded.

only way he'd be "caught" is if audited. Slim to zero chance of that.

That's an interesting philosophy . . .

Looking at it another way, it is only cheating if your wife finds out.

 

[Crabcake Johnny]

Right - and everyone's Schedule C's are 100% dead on.

 

[arnguy]

Right - and everyone's Schedule C's are 100% dead on.

Well, I certainly hope so.

 

[Crabcake Johnny]

Hey, that massage IS a business expense!

 

[arnguy]

Gosh, I didn't know that.