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Best Health Savings Account Plans Question & Answers

2013 September 19
by Sarah Fields

Richard asks…

Can I sign up for a HSA while collecting social security?

I am still working full time but plan on collecting social security pension beginning in February 2013. Can I also qualify for a Health Savings Account while collecting Social Security retirement benefits?
Actually I tried that first but did not find the answer. However I did find an answer on another website and it seems that you can have a Health Savings account as long as you are still working and have a qualifying high deductible health insurance plan where you work and therefore are not covered by medicare yet.

Thanks for the effort anyway.

Sarah Fields answers:

I’m not sure of the answer brother, but maybe you can try the social security website for more information.


Hope this helped.

James asks…

What happens when there’s nothing in my HSA?

Due to a payroll snafu, my Health Savings Account has nothing in it, and I’m having a baby next month. Since I’m on a high-deductible plan, I’ll have to pay for everything out of my savings account for the expenses and repay myself out of the HSA whenever there’s money back in there.

Do I need to do anything special regarding record keeping for this year’s taxes, since I’m paying for medical expenses from a post-tax account and refunding myself out of my pre-tax account? Do I just hang on to the medical receipts and give them to my tax preparer as usual no matter how I paid the bills?

Sarah Fields answers:

If you haven’t put any money into your HSA over the past few years, then nothing is in it. Nothing happens with it.

You can’t refund yourself with money that flat out isn’t there yet. It’s just like an IRA for medical bills – you can’t pull money out of it, until you’ve put money INTO it. Money you put in it, cannot be used to pay for past bills – only future ones, going forward.

Laura asks…

How much of a federal tax break from a Health Savings Account?

Recently bought a HDHP. Im eligible for an HSA, have the $ and it seems like a good idea to sock the $3250 maximum in there every year.

My question is, how much of a tax break might I get ?

No earned income, Stock gains, interest & dividends of between $20k and $50k per year.

How much of the $3250 will be a tax credit ?

10% ? 15 ? More ?

Im talking about the decision to open an HSA and fund it to the max this year and every year after.

Ideally, in a few years, I would transfer it to some kind of brokerage account and maybe invest with it when it gets to be larger than $3250.

Initially, I was planning on opening it with a credit union that pays 1.5% but has no fees.


My health plan is $174 per month for a $3250 deductible with a $5000 max per calender year. Blue Cross covers 80% after $3250 until Ive spent $5000 and then they pay it all.

PS, My question solely relates to the tax advantages of getting the HSA versus not getting it.

My state offers no deduction.
Filing status is single with no dependents. Most of my stock gains will be long term gains.

I guess I hoped for a bit more than 0-800 but there still isn’t much downside to opening one up from what I can tell.

Even if its just a few hundred a year. That’s free money.

Sarah Fields answers:

Quick Answers has the right idea, though you could do one better if you just did your own 2012 taxes in Turbo Tax (or similar product). If your income is likely going to be the same, then just plug it into the program as if you did it last year. The result will be in the same ballpark or exactly the same depending on your income.

All it will do is lower your AGI by whatever you deposit and therefore lower your taxable income. The higher the tax bracket, the more advantageous it is to do.

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