A health savings account can be a great way to cut health care costs if you’re eligible for one. As we have pointed out, HSAs offer almost unparalleled tax advantages for savers.
You can pull money from an HSA — tax-free — to help cover qualified and unreimbursed health care costs you rack up throughout the year.
The key to getting the most from your HSA is to use the money for expenses that the IRS has deemed “qualified.” Some of these are obvious, such as dental fees, prescription drug costs and eye exam expenses.
However, you can also use an HSA to cover costs you might never have imagined. IRS Publication 502 details a list of sometimes surprising expenses that qualify for HSA reimbursement.
For example, the following all meet the criteria for “qualified” medical costs under current rules in at least some situations:
It is important to note that some of these expenses only qualify in very specific circumstances. So, don’t book a trip to the Bahamas in hopes you can write off the flight cost as a medical expense if you get a “therapeutic” massage at your resort.
For more details on the deductibility of these expenses — and others — check out IRS Publication 502.
Remember, not everyone is eligible to open an HSA. To learn more, read, “Am I Eligible for a Health Savings Account?” by Money Talks News founder Stacy Johnson, who has used an HSA for years.
If you are eligible, though, an HSA can be a great investment. Money Talks News contributor Miranda Marquit talks about her experience with HSAs in “3 Ways a Health Savings Account Can Improve Your Finances.”
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