Commonly asked questions
Every year, the Internal Revenue Service (IRS) sets guidelines on how much you can contribute to an HSA. Contributing the maximum can help you get the most from your HSA. You’ll enjoy income tax-free contributions, growth and withdrawals when funds are used for qualified medical expenses.*
Use the HSA calculator to find the contribution amount that’s right for you. To learn more about contribution limits, read this article.
Excess contributions may be subject to penalties. The calculator helps you stay within IRS limits.
Balances vary, but older account holders tend to have higher savings due to investment growth.
Rates vary by provider. Optum Bank offers competitive interest and investment options.
Yes. The tool includes projections based on your investment preferences and time horizon.
The calculator breaks this down for you based on your annual goal and pay frequency.
You can use your HSA to pay for IRS-qualified medical expenses for yourself, your spouse and any eligible dependents.
Eligible expenses may include deductibles, copayments, doctor visits, hospital services, mental health care, acupuncture, prescriptions, dental and vision care, and a wide range of over-the-counter (OTC) products. Note that eligible expenses may change over time.
Your HSA is yours, not your employer’s — even if you change jobs, switch health plans or retire. Plus, your funds roll over from year to year and never expire.
You can keep the account open, transfer it to a new provider or use the funds for qualified medical expenses. If you switch to a non-high-deductible health plan, you can still spend the funds in your account, but you’re no longer eligible to contribute to it.
Yes. While an HSA isn’t a traditional retirement account, it can be a powerful way to save for health care and other expenses later in life.
After age 65:
- You can continue to use your HSA to pay for qualified medical expenses income tax-free, helping you save other retirement accounts for non-medical needs.
- If your HSA includes an investment option, you can also use those funds for non-medical expenses. You’ll pay ordinary state and federal income tax on those expenses, but there is no penalty.
Your HSA also offers triple tax benefits, making it an effective long-term savings tool:
- Contributions are tax deductible up to IRS limits.
- Withdrawals for qualified medical expenses are income tax-free.
- Any invested funds grow tax-free.
*Income taxes may apply in certain states. This communication is not intended as legal or tax advice. Consult a legal or tax professional for advice on eligibility, tax treatment and restrictions.
HSA contributions generally stop when enrolling in Medicare. If you choose not to enroll in Medicare, you can contribute to your HSA as long as you meet the eligibility requirements. The overall tax benefits of an HSA, which include contributions, earnings and withdrawals, can be affected by future changes in federal tax rates.
Account holders who join an HSA eligible health plan on or before the first day of the last month of their tax year (December 1 for most taxpayers) may contribute up to the annual statutory maximum, plus any applicable catch-up contributions. However, if HDHP coverage is not maintained for the entire test period, all or a portion of contributions may be subject to taxes plus a penalty.
This HSA calculator is intended to be used as a reference tool only. Your actual maximum contribution, tax savings and future savings may vary depending on a number of factors (such as variations in other payroll taxes, income or medical expenses and changes in state or federal tax laws or regulations.) The content of this communication is not intended as legal or tax advice. Federal and state laws and regulations are subject to change.
Health savings accounts (HSAs) are individual accounts largely held at Optum Bank®, Member FDIC, and administered by Optum Financial, Inc. or ConnectYourCare, LLC, an IRS-Designated Non-Bank Custodian of HSAs, a subsidiary of Optum Financial, Inc. Neither Optum Financial, Inc. nor ConnectYourCare, LLC is a bank or an FDIC insured institution. HSAs are subject to eligibility requirements and restrictions on deposits and withdrawals to avoid IRS penalties. State and/or local taxes may still apply. Fees may reduce earnings on account. Refer to your HSA account agreement for details.
This communication is not intended as legal or tax advice. Federal and state laws and regulations are subject to change. Please contact a legal or tax professional for advice on eligibility, tax treatment, and restrictions. Please contact your plan administrator with questions about enrollment or plan restrictions.
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