Health Savings Accounts
How are withdrawals from an HSA treated if they are not used for qualified medical expenses?
Any amounts used for purposes other than to pay for qualified medical expenses are taxable as income and subject to an additional 10% tax penalty. After the account holder turns age 65, or become disabled, the 10% additional tax penalty no longer applies.
View additional questions:
- What is a Health Savings Account (HSA)?
- How do employees qualify to open an HSA?
- When can contributions be made to an HSA?
- Can employer's still offer their regular Health Care Flexible Spending Account (HCFSA) Plan to HSA participants?
- Do employers have to amend the Cafeteria Plan to allow for pre-tax contributions to the HSA?
- How much can be contributed to an HSA?
- Can money be rolled over from an employee's Health Flexible Spending Account (HCFSA) or Healthcare Reimbursement Account (HRA) into an HSA?
- Can a participant transfer money from his or her Individual Retirement Account (IRA) into an HSA?
- Who can contribute to an HSA?
- What can the participant use the HSA money for?
- How are withdrawals from an HSA treated if they are not used for qualified medical expenses?
- Are contributions to and distributions from an HSA reported to the IRS?