There is no such thing as an after-tax HSA. If you get a form 1099-SA at the end of the year to report your withdrawals, and you get a form 5498–SA to report your contributions, then it is a regular HSA. You are supposed to report those contributions on your tax return and take a text adduction for them. If you have not been taking the tax deduction, then it is still an HSA and withdrawals for nonqualified spending purposes are still subject to income tax and a 20% penalty. If you don't report it and pay the tax, the IRS will come after you, because they get copies of all the documentation and will know that it was not reported properly on your tax return. If you have for some reason been failing to claim the tax deduction in past years, you may be able to fix some of that on an amended return. You may want to see a tax advisor.
If you do not get a form 1099-SA, but instead get a form 1099-INT for interest income, then it is not an HSA, it is a regular savings account. Although it might be marketed by the bank in a different way. If it is a regular savings account, you can do anything you want with the money.
