HSA News for March 22, 2021
HSA news is compiled weekly by Mr. HSA, Roy Ramthun.
News from Washington
IRS Postpones April 15 U.S. Tax Deadline to May 17
The IRS and Treasury Department postponed the April 15 tax-filing deadline to May 17, the agencies announced March 17. The extended deadline applies only to federal income returns and taxes, meaning that taxpayers will need to check to see if due dates for state taxes have been changed. Estimated quarterly payments are still due on April 15.
House Democrats Bring Back Medicare-for-All, Seeking to Push Biden Left
House Democrats renewed their effort to enact Medicare-for-all on March 17, arguing the year-long pandemic was a “wake-up call” to replace the nation’s fragmented health insurance system — and betting they can pressure President Biden to embrace a government-run program that he famously rejected.
HSA Compliance Corner
VA Care Is Always Disqualifying? No - Plus a Hack to Maximize Deposits
Military veterans must beware of two such situations--continuing to carry their TRICARE coverage and having access to care through the Department of Veterans Services medical system. Receiving certain care from the VA disqualifies a Health Savings Account owner from funding an account for three months.
Some Common-Sense Improvements to HSAs
Some people who are enrolled in HSA-qualified health insurance coverage are disqualified from funding a Health Savings Account. The list includes people enrolled in Medicare and Tricare, as well as veterans and Native Americans. Simple fixes to the HSA law would change that.
IRS Releases 2020 Form 8889 and Instructions for HSA Reporting, Updates Publication 969
The IRS has released the 2020 version of Form 8889 and its instructions, and has updated Publication 969 for 2020 tax returns. The 2020 versions of Form 8889 and its instructions are substantially similar to their 2019 counterparts. Updated Publication 969 includes changes regarding over-the-counter medicines that are not prescribed, menstrual care products, telehealth, and other remote care coverage.
HSA Industry News
Fidelity HSA Assets Top $10B
Assets in funded HSAs at Fidelity surpassed $10 billion, the company announced on March 15. The number of accounts increased by 19% last year to 1.76 million. Total assets increased 52% to $10.2 billion. Account holders who are using their HSA to invest also grew, increasing 42%.
HSA Industry Best Practices
Participants More Engaged Than Ever at Work
With employee engagement up, now is a particularly good time for employers to talk about the value of HSAs to their employees. Employers should make open enrollment as active a process as possible and ask their workers to think hard about their health care needs. Employers might also want to consider contributing a match to employees’ HSAs to encourage more participation.
HSAs & Retirement
Get Triple the Tax Benefits With an HSA, and Find an Affordable Health Plan While You’re At It
Doctor visits, unexpected trips to the hospital and medications can be expensive at any age, but retirees can expect to spend hundreds of thousands of dollars on healthcare in their old age. The HSA shines as a tool for paying future medical bills and is a critical way for people to build a medical nest egg over time.
How to Maximize HSA Value for Retirees
Most of the healthcare costs that a retiree will encounter can be paid for tax-free with a health savings account, according to a paper by Willis Towers Watson. Employees who start saving “early can accumulate enough resources to cover healthcare expenses in retirement assuming normal retirement at age 65,” according to the paper.
Maximizing Your HSA
The Triple Tax Break You May Be Missing: A Health Savings Account
A health savings account can help pay for some medical expenses, if you qualify to have one. And they offer three valuable tax breaks: Money is deposited pretax, can grow tax-free and is not taxed when you spend it, as long as the expenses are eligible. It is rare for so many tax advantages to be wrapped into one benefit, financial advisers say.
Consumer-Driven Health Care
Sidecar Expands Sales of Indemnity Health insurance Plans
Sidecar Health has started selling its new, high-tech version of indemnity health insurance in its 16th state: Utah. Consumers who have high-deductible coverage may be able to use indemnity insurance to pay medical bills that hit before patients have met their deductibles.