That's what I thought. We used both last year on medical expenses. We did not use HSA funds to pay for any HRA reimbursed claims. My husband used his HSA to pay for the $4k in claims that weren't covered by the HRA. I am keeping receipts, bills, and EOBs along with a timeline for tax record keeping purposes. Do I have to turn all of this documentation into his employer as well? His employer is the one who submits all of the EOBs to the third party administrator (PrimePay) for reimbursement. It automatically was reimbursed to my husband. The crazy thing is, some of the employees don't even know that his employer signed them up for an HRA....
His boss and their insurance broker told me that my husband can use the HSA funds to pay for medical expenses and then get them reimbursed by the HRA. Then we would report the HRA reimbursements on our tax return and pay taxes on the reimbursements. After reading the IRS 969 Publication and your reply, I believe this to be an incorrect way to handle this health plan arrangement. You are not allowed to use HSA funds to pay for any medical bills that have been reimbursed. Since we didn't use the HSA funds to pay for the HRA covered claims, we should not owe taxes on those disbursements. Am I correct in this understanding?
