Can I be reimbursed from HSA for eligible medical expenses incurred after HSA established but before funded?

Forum|Forum|6 years ago
March 19, 2020
1 reply
14 views

Opened an HSA in December 2019. Incurred and paid $1,000 in eligible medical expenses in Jan and Feb 2020. Funded the HSA in March 2020 with $3,000. Looking to now distribute $1,000, but want to be sure there will not be any taxes or penalty on the $1,000 distribution when filing 2020 federal taxes next year.

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MinhT1

Level 15

Distributions from a HSA are compared with medical expenses for the whole year in 2020. In your case, there will not be any tax or penalty on the distribution in 2020.

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daveof203Author

Level 2

Thank you for your response. So, even though the HSA was FUNDED after these medical expenses were incurred, it would not matter?

JohnB5677

Level 15

An HSA's establishment date is key. While you can wait years to reimburse a medical expense, the expense must have incurred after the HSA's establishment date. That means you cannot use the plan for expenses prior to the establishment date.

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