hsa distributions to pay yourself back for medical expenses from prior years?

[tuxedorose]

on 4/15/2019  i funded an HSA account for tax year 2018 . I have had several medical expenses since than but never used the debit card associated with that account (and thus never received any 1099-SA)

am I allowed to 'reimburse' myself NOW (in 2020) for all of those expenses I incurred during TY2018 or only for expenses incurred after the date I opened the account (4/15/2019) ?

when I complete my 2020 taxes, do these reimbursements have any impact on my taxes?

THx

[Opus 17 · Accepted solution]

You can only reimburse yourself for expenses incurred after you opened the account.

[tuxedorose]

Thanks....and when I  reimburse myself now for an expense that occurred in 2019 I

 Need to declare this on 2020 tax return?

Will it be tax neutral.?

[Critter-3 · Accepted solution]

https://www.haylor.com/wp-content/uploads/2015/11/128772-Health-Savings-Accounts-HSAs-Distribution-R...

It will be tax neutral ... on the form 8889 the distributions will be reported and be offset by the amount used for medical expenses ... net zero.

[Opus 17 · Accepted solution]

If you make HSA deposits through payroll contributions, they will be recorded on your W-2 and you will not enter any additional contributions when the interview asks about them. Under the tax code, any contributions that are made by your employer, whether they are free money from your employer or your voluntary contributions, are treated as if they were made by your employer.  You don’t get an additional tax deduction for them because they are already not included in your taxable income.

If you make separate contributions not by payroll deduction, you will enter them in the HSA interview and you will get a tax deduction for them, as long as you certify that you are enrolled in qualifying insurance.

You must also report any withdrawals that you made from your HSA during the tax year. These are reported to you by the trustee on a form 1099-SA.  You will be asked if the withdrawals were used for qualifying medical expenses. As long as you click “yes“, the withdrawals will not be included in your taxable income. But, you must report them.

Since you say that you opened the account on 4/15/2019 by making a contribution for the 2018 tax year, the deduction for that contribution must be claimed on your 2018 tax return. Any contributions that were made for the 2019 tax year year will be reported on your 2019 tax return. If you did not claim the 2018 contributions on your 2018 tax return, you will have to go back and file an amended 2018 return.