HSA: U.S. Health Savings Account

Use this form to edit the properties of a U.S. Health Savings Account (HSA). To change its investments or balance, select Edit investments. The account balance is calculated as the sum of its investments.

The TIME MACHINE assumes that this is an existing HSA retained after the account owner leaves the United States. Growth within the account is treated as tax-free.

No deposits to an HSA are permitted in the TIME MACHINE.

Withdrawals used for eligible medical expenses can be made at any age and are treated as tax-free. Other withdrawals are not permitted before age 65, thereby avoiding the additional 20% U.S. tax that may apply.

Beginning at age 65, other withdrawals are permitted, but the TIME MACHINE treats them as taxable income.

To pay a planned medical expense from this account, add or edit an entry in EXPENSES. In the Tax deduction/credit menu, select Medical expense paid with US HSA account and the name of the HSA.

The TIME MACHINE will withdraw the expense from the selected HSA, up to the amount available in the account, without treating the withdrawal as taxable income.

The expense must belong to the HSA owner or be entered as a Joint expense. A Joint expense can continue to be paid from the HSA after it is inherited by a surviving spouse. Alternatively, add a separate expense for the spouse that begins after the account owner’s death.

You are responsible for determining whether an expense qualifies under the U.S. HSA rules. Consult the current IRS publications before selecting this option. Do not assume that Canadian health-insurance premiums or every medical expense recognized in Canada will qualify under the U.S. rules.

An existing HSA cannot be changed to another account type. If the account type was entered incorrectly, you may need to create the correct account and delete the HSA.

An HSA can have only one owner and cannot be held jointly. If you have a spouse, you can change the owner to correct an input error or to record an inheritance in the MoneyReady App.

Changing the owner may affect automatic saving and withdrawal priorities. The priorities of the affected accounts will be reviewed by the TIME MACHINE.

If your spouse is selected as beneficiary, the TIME MACHINE will transfer the HSA to your spouse at your passing. The account will continue as the spouse’s HSA, and its beneficiary will become the new owner’s Estate.

If there is no surviving spouse, the TIME MACHINE will empty the account without charging tax or probate to the account owner’s Estate. It assumes that any applicable tax will be paid by the beneficiary.

If the growth rate of the Cash investment has not yet been entered, the field Growth per year (%) of Cash investment may be shown. Once the rate has been saved, you can change it by editing the Cash investment.

A minimum positive balance can be set for the account, and it will be honoured by the TIME MACHINE.