Frequently Asked Questions about Health Savings Accounts
HDHP stands for "high deductible health plan." A qualified HDHP is a health insurance plan with a minimum annual deductible of at least $1,250/individual coverage or $2,500/family coverage in 2014. For 2015 the minimum annual deductibles are at least $1,300/individual coverage or $2,600/family coverage. For 2014, the annual out-of-pocket expenses cannot exceed $6,350/individual coverage or $12,700/family coverage. For 2015, the annual out-of-pocket expenses cannot exceed $6,450/individual coverage or $12,900/family coverage. See your health insurance professional for guidance.
Please review your eligibility with your benefits plan administrator. In general, you are eligible to contribute to an HSA for a given month if, on the first day of the month, if you are:
See IRS Publication 502 for a general list. In 2012, qualified out-of-pocket expenses include, but are not limited to, the following:
The high deductible health plan (HDHP) and most other insurance premiums are not included as qualified out-of-pocket expenses. See your tax advisor for more information or review the IRS Publication 502 for a complete list.
Once the eligibility requirements are met, anyone can contribute to your HSA on your behalf, including: yourself, your employer, family members, or friends. Total contributions are subject to annual contribution limits. As the account owner, you are responsible for ensuring that you comply with all contribution limits.
Yes, your employer may contribute to your HSA on your behalf. Keep in mind, you are responsible for ensuring that you comply with all contribution limits. Contributions made on your behalf belong to you; at all times you control how funds in your HSA are used.
If total contributions exceed the allowable HSA contribution limit for the year, you may be subject to an excess contribution tax. You should speak with your tax advisor and / or legal counsel for additional information.
An individual who becomes HSA-eligible during the middle of a tax year and who is HSA-eligible during the last month of the tax year may make HSA contributions for all previous months in the year up to the annual limit. However, if the taxpayer does not remain HSA-eligible for all of the following tax year for any reason other than his or her death or disability, then the excess HSA contributions are subject to income tax and a 6% penalty. You should discuss your contributions limits, including any catch-up contributions with your tax or legal advisor. BMO Harris Bank does not provide tax or legal advice.
You are likely eligible for an HSA if you or your spouse is enrolled in a limited-purpose FSA or HRA, but you should confirm your eligibility with your tax advisor or insurance professional.
The following transfers and rollovers are permitted:
- HSA to HSA (transfers and rollovers)
- Archer MSA to HSA (transfers and rollovers)
- One-time IRA (not including a SEP or SIMPLE) transfer to an HSA.
Please review and complete the Health Savings Account (HSA) Transfer / Rollover Review to facilitate the funds transfer. For more information, please contact your Personal Banker or consult your tax advisor.
We make it easy to keep track of deposits and withdrawals.
If the beneficiary is your spouse, ownership of your BMO Harris HSA is automatically transferred at the time of your death and he/she is subject to federal income tax only if the distributions from the HSA are not used for qualified medical expenses. State taxes may vary.
If the beneficiary is not your spouse, a lump-sum distribution is made as soon as practicable after your death to your designated beneficiary and is subject to federal income tax for the full amount (less any qualified medical expenses incurred by the decedent and paid from the HSA within one year of death). State taxes may vary.
You can get more information about an HSA by consulting your insurance professional, benefits plan administrator, tax advisor, or meeting with a BMO Harris Banker. Also visit the following links for additional details: IRS Publication 969, IRS Publication 502 and US Treasury.
To open your BMO Harris HSA, we recommend first contacting your employer (if applicable), or your health insurance or tax professional to review your eligibility and how an HSA can work for you. Call or visit your a local BMO Harris branch to establish your HSA and set up a contribution program.