My wife and I file taxes as married filing separately as she is on an income driven repayment plan. She is on my insuarnce through my work, and we plan to place our newborn twins on my insurance. I have an HSA that has been with me for years. Can I use that HSA to pay for both my wife and newborns medical bills? It seems like the answer is yes, but I am not able to find a clear answer.
Yes, you can use the HSA to pay for care for yourself, your spouse, and your dependents. However, the situation is a bit odd when it comes to children who you don't claim as tax dependents. The rules for medical insurance allow you to cover a child who is your dependent, or who would have been your dependent except that you file separately or are divorced or separated. However, the rules for HSA seem to say that you can use the HSA to pay for expenses for children who are your tax dependents, and for children who would have been your tax dependents except for divorce or separation, but there is a very obvious lack of mention of children that you don't claim because you are together, but filing separately for economic reasons. If for some reason you plan to have your wife claim your children as tax dependents when filing separately, you might want to run the situation past a local tax expert.
https://www.irs.gov/publications/p969#en_US_2022_publink1000204083
this is from code section 223 which specifies the rules for an HSA
(2)Qualified medical expenses
(A)In general
The term “qualified medical expenses” means, with respect to an account beneficiary, amounts paid by such beneficiary for medical care (as defined in section 213(d)) for such individual, the spouse of such individual,
Nowhere does it say that a married couple must file jointly.
Yes, you can use the HSA to pay for care for yourself, your spouse, and your dependents. However, the situation is a bit odd when it comes to children who you don't claim as tax dependents. The rules for medical insurance allow you to cover a child who is your dependent, or who would have been your dependent except that you file separately or are divorced or separated. However, the rules for HSA seem to say that you can use the HSA to pay for expenses for children who are your tax dependents, and for children who would have been your tax dependents except for divorce or separation, but there is a very obvious lack of mention of children that you don't claim because you are together, but filing separately for economic reasons. If for some reason you plan to have your wife claim your children as tax dependents when filing separately, you might want to run the situation past a local tax expert.
https://www.irs.gov/publications/p969#en_US_2022_publink1000204083