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Can i withdraw cash from hsa debit card


can i withdraw cash from hsa debit card

How do I access my HSA funds? · An HSA Visa debit card · An HSA checkbook · Online banking · Stop into any LMCU branch to withdraw cash. Yes: Withdrawing funds from your HSA can be as simple as swiping a card. You can use your HSA debit card to pay for medical supplies, doctor co-pays and. Once your employer elects the TASC Card feature, a card will be sent to you at your address on You may also withdraw your funds at an ATM with a PIN.

Can i withdraw cash from hsa debit card -

FSA, HRA, HSA Benefits Debit Card &#; Convenient and Secure

Card payments are part of everyday life. No matter where you go &#; doctors&#; offices, pharmacies, grocery stores, retail shops, taxis, subway stations, and more &#; you can use a credit or debit card to pay for goods and services. Cards are more convenient and secure than cash or check, and more and more employers are making them an essential part of their benefits packages.

When you have a benefits debit card linked to your Flexible Spending Account (FSA), Health Reimbursement Arrangement (HRA), or Health Savings Account (HSA), you can enjoy extraordinary convenience and security.

Benefits Debit Card Overview

FSA Debit Card

Plan participants with an FSA debit card can use it in stores and online to pay for IRS-approved healthcare expenses. Some retailers and pharmacies clearly identify FSA-approved items, and many card processors offer auto-adjudication for those purchases. There are also specialty online stores, like mynewextsetup.us, that sell only FSA eligible items. This makes it easy for card holders to know where their FSA dollars are going; the restricted purchasing helps to stop fraud and misuse.

If you have a Dependent Care FSA (also known as DCAP) with a card, you can use it to pay tuition and fees at the childcare provider.

HRA Debit Card

If your company offers HRAs, it can add an account-linked card for employer-approved expenses. With an HRA debit card, you don&#;t have to pay out of pocket and file for reimbursement. It&#;s a win-win for you and your employer since this greatly reduces the amount of claims filing and processing.

HSA Debit Card

Like an FSA, HSAs can also be linked to a debit card. An HSA debit card can be particularly useful for those who enjoy rollover at years&#; end, which can result significant account growth. You can find specialty online merchants like mynewextsetup.us, which sells only HSA eligible items. Many HSA providers also have an online receipt storage vault where you can store electronic versions of claims-related documents for self-certification.

In addition to FSAs, HRAs, and HSAs, there&#;s another employer-benefit account that can be linked to a debit card: a Transit account. With a Transit debit card, you can pay for bus, subway, and taxi fare, cover parking expenses, and more.

Need to Know!

If you have an employer-sponsored benefits debit card for your account(s), you cannot use it at an ATM to withdraw cash.

For more information about your benefits debit card, or to find out if your company offers them, contact your HR department.

Источник: mynewextsetup.us

Top 10 reasons to use health savings accounts

You&#;ve probably heard of health savings accounts (HSAs), and you may have wondered if one would be a good fit for you. You aren&#;t alone.

According to a survey released in , approximately 30 million Americans have chosen to use a health savings account coupled with a high-deductible health plan (HDHP) to pay for current and future healthcare costs. More than half of American workers with employer-sponsored health coverage were enrolled in HDHPs as of (some people have an HDHP but opt not to open an HSA; you&#;re allowed to contribute to an HSA if you have HDHP coverage, but are not required to do so).

HSAs have increased in popularity since their debut in Understanding the increase in enrollment isn&#;t difficult when one takes a closer look at how HSAs work and the impressive array of benefits they offer to people willing and able to use them.

Who can utilize HSAs?

In order to contribute to an HSA, you need to be covered under a high-deductible health insurance plan, either obtained through your employer or purchased on your own. The majority of large employers offer an HDHP option (70% did so in ), and HDHPs are available for purchase in the individual market nearly everywhere in the country. (That means you can have an HDHP and HSA even if you buy your own health insurance. An employer doesn&#;t have to be involved.)

Once you&#;re enrolled in an HDHP, you can open an HSA (or sign up for the one your employer uses) and begin making contributions. And if you&#;re on the fence about whether it&#;s the right move for you, here are some things to keep in mind:

1. HSAs offer a triple tax advantage

The HSA is a rare breed in terms of tax-advantaged accounts:

  • The money you put into your HSA is pre-tax.
  • While the money is in your HSA, there&#;s no tax on investment gains or interest earned in the account.
  • And then when you withdraw the money, it&#;s still tax-free – as long as you use it to pay for qualified medical expenses.

Contributing to your HSA reduces your ACA-specific modified adjusted gross income, which is important to keep in mind if you’re buying your own coverage in the health insurance marketplace/exchange. The higher your ACA-specific MAGI, the smaller your premium subsidy will be (normally, there&#;s an income cap for subsidy eligibility, equal to % of the poverty level; that&#;s been eliminated for and as a result of the American Rescue Plan). You might find that an HSA contribution makes you eligible for a larger premium subsidy. Here’s more about how this works.

2. Paying medical expenses with pre-tax dollars

Once you&#;ve put money in your HSA, you can withdraw it at any time to pay for a qualified medical expense. And qualified medical expenses go well beyond the out-of-pocket costs for services that are covered by your health insurance plan. They also include includes things like dental and vision costs, as well as products like sunscreen (SPF 30+), bandages, and lip balm.

If you don&#;t have an HSA, you can only deduct medical expenses by itemizing your deductions on your tax return. And even if you itemize, you can only deduct medical expenses that are in excess of % of your income.

3. Your HSA can be a backup retirement account

If you withdraw money from your HSA before you turn 65 and you&#;re not using it to pay for qualified medical expenses, you&#;ll have to pay income tax and a 20% penalty. (Don&#;t do this unless it&#;s a dire emergency!)

But once you turn 65, that 20% penalty no longer applies. You can continue to use your HSA funds for medical expenses, avoiding taxes altogether on the withdrawals. But if you choose to withdraw the money for other purposes, you&#;ll just pay income tax. This is similar to how a traditional IRA works in terms of taxes. (Note that with a traditional IRA, you can start to withdraw money penalty-free at age , whereas with an HSA, you have to be )

And unlike traditional IRAs, you&#;re not required to start taking money out of your HSA when you turn If you want to leave it in the account to continue to grow, you can do that.

4. Pre-tax contributions &#; regardless of your income

Although you can think of your HSA as a backup retirement account, there is no income limit – on the low end or the high end – for deducting HSA contributions.

This is not the case for IRAs: There&#;s an income limit for Roth IRA contributions, and an income limit for being about to contribute pre-tax money to a traditional IRA if you also have a retirement plan at work. And both require you (or your spouse) to have enough earned income to cover the contributions.

But to contribute to an HSA, you just need coverage under an HSA-qualified high deductible health plan (HDHP) without any additional major medical coverage, and you can&#;t be claimed as a dependent on someone else&#;s tax return. Your income isn&#;t a factor.

5. The money in your HSA continues to grow &#;

With an HSA, there&#;s no &#;use it or lose it&#; provision. This is one of the primary differences between an HSA and an FSA. If you put money in your HSA and then don&#;t withdraw it, it will remain in the account and be available to you in future years.

6. &#; and you can choose how your HSA grows

HSA funds can be kept in basic interest-bearing accounts – similar to a regular savings account at a bank or credit union – or, if you choose an HSA custodian that offers it, you can invest your HSA funds in stocks, bonds, or mutual funds.

There&#;s no single right answer in terms of what you should do with the money in your HSA before you need to use it. If you&#;re planning to withdraw all or most of your contributions each year to fund ongoing medical expenses, an FDIC-insured institution might be the best choice. The account will likely only generate small amounts of interest, but it will also be protected from losses.

On the other hand, if you&#;re looking at your HSA as a long-term investment and your risk tolerance is suited to the stock market&#;s volatility, you might prefer to invest your HSA funds. Note that most HSA owners do not have their HSA funds invested. For some, this is a calculated decision based on their risk tolerance and their need to access the money in the near future. But for others, the account might serve them better if the funds were invested, but they simply don&#;t understand the options available to them.

If you buy your own HDHP, you can select from any of the available HSA custodians. (Pay attention to fees, investment options, and expense ratios, as is always the case with investment accounts.)

If you have an HSA through your employer, you might be limited to using the HSA custodian that your employer has selected, at least as far as your employer&#;s contributions go. And HSA contributions made via payroll deduction are typically free of income tax and payroll tax. You can&#;t avoid payroll taxes if you make your own HSA contributions outside of your employer&#;s payroll.

But you&#;re free to establish a separate HSA on your own, and transfer money out of the HSA your employer selected, and into the one you picked yourself. The IRS considers this a transfer, instead of a rollover, so there are no limits on how often you can do this.

Ready to try out a Health Savings Account?


7. You can leave your job and take your HSA

If you have an HSA through your employer, the money in the account is yours. When you leave your job, you get to take the remaining HSA balance with you. This is another difference between FSAs and HSAs.

You can choose a new HSA custodian and transfer the money if you wish. There are no taxes on the HSA money you take with you when you leave your job, unless you withdraw the money and don&#;t use it for medical expenses.

8. Deductibles aren&#;t necessarily higher than other plans

You must have a high-deductible health plan (HDHP) in order to contribute to an HSA. And it&#;s understandable that the term &#;high-deductible&#; makes people nervous. But the deductibles aren&#;t necessarily higher than the deductibles for non-HDHPs, and in some cases, they&#;re even lower.

For , IRS regulations require HDHPs to have deductibles of at least $1, for an individual and $2, for a family. But average deductibles for Bronze and Silver plans in the individual market are considerably higher than that. Among people who have employer-sponsored plans that include deductibles (about 85% do), the average deductible for a single employee is nearly $1,

And the maximum out-of-pocket limits for HDHPs are lower than the maximum out-of-pocket limits for other plans – a difference that is getting wider with each passing year. In , the HDHPs have to cap out-of-pocket costs at no more than $7, for an individual, and $14, for a family. In contrast, ACA regulations allow non-HDHPs in to have out-of-pocket limits as high as $8, for an individual, and $17, for a family.


So although HSA-qualified plans are officially &#;high-deductible,&#; they sometimes have deductibles and out-of-pocket limits that are lower than other available plans. It&#;s possible to find HSA-qualified plans at the Bronze, Silver, and Gold metal levels if you&#;re shopping for your own coverage.

And as time goes by, HDHPs may start to cover more services before the deductible, for people with certain chronic conditions. Until , HDHPs were limited to covering only preventive care before the deductible (ie, prior to the insured meeting the minimum deductible amount that the IRS sets each year), and the definition of preventive care was updated in to align with the preventive services that the ACA requires all non-grandfathered health plans to cover.

But in July , in response to an executive order that had been signed the month before, the IRS issued new guidelines for preventive care that can be covered before the deductible on an HDHP without forfeiting the plan&#;s HSA eligibility. Under the new rules, an HDHP can cover, pre-deductible, certain specific health care benefits for people with certain chronic conditions and the health plan can remain HSA-eligible (assuming it meets all of the other requirements for HSA-eligibility. For people with the following chronic conditions, these services can be covered before the deductible on an HDHP:

  • Congestive heart failure or coronary artery disease: ACE inhibitors and/or beta blockers
  • Heart disease: Statins and LDL cholesterol testing
  • Hypertension: Blood pressure monitor
  • Diabetes: ACE inhibitors, insulin or other glucose-lowering agents, retinopathy screening, glucometer, hemoglobin A1c testing, and statins
  • Asthma: Inhalers and peak flow meters
  • Osteoporosis or osteopenia: Anti-resorptive therapy
  • Liver disease or bleeding disorders: International Normalized Ratio (INR) testing
  • Depression: Selective Serotonin Reuptake Inhibitors (SSRIs)

Note that HDHPs are not required to offer any of these benefits pre-deductible, unless a state decides to require it on state-regulated plans. These are benefits that go above and beyond the federally-required preventive care services, so whether to offer these services pre-deductible will be up to each insurer. But offering them will not cause a plan to lose HDHP status, which would have been the case prior to July

9. There&#;s no deadline for reimbursing yourself from your HSA

When you pay a medical bill and you have an HSA, there’s nothing that says you have to pull money out of your HSA to cover the medical bill. And there’s also no time limit on when you can reimburse yourself. As long as the medical expense was incurred after you established the HSA, and you didn’t take it as an itemized deduction, you can reimburse yourself years or decades later — after letting your HSA funds grow in the meantime.

So imagine that you’re contributing to your HSA each year, and also spending a few hundred or a few thousand dollars each year in medical expenses. You pay those bills from your regular bank account, keeping careful track of how much you pay and retaining all of your receipts.

Now let’s say that you decide you want to retire a few years early, before you can start withdrawing money from your regular retirement account. At that point, you can gather up all of the receipts from all the medical expenses you’ve paid since you opened your HSA, and reimburse yourself all at once (this is why it’s so important to keep your receipts — if you’re ever audited, you’ll need to be able to show that the amount you withdrew from your HSA was equal to the amount you had paid in medical bills over the years).

The money you withdraw is still tax-free at that point, since all you’re doing is reimbursing medical expenses (again, be careful not to withdraw more than you&#;ve spent in documented medical expenses; if you do, you&#;ll have to pay income tax and a 20% penalty on the excess withdrawal). But because you waited a few decades to reimburse yourself, you’ve given the money in your HSA many years to grow, tax-free, resulting in a potentially larger stash of funds.

Your HSA can be your long-term care fund

If you&#;re healthy and don&#;t have much in the way of medical expenses, you can think of your HSA as a really long-term investment. You&#;ll have to stop contributing to it once you&#;re enrolled in Medicare, but the money that&#;s already in the account at that point can continue to grow from one year to the next during your retirement.

You might find that you want to use your HSA funds, tax-free, to pay Medicare premiums. (That&#;s Part A if you&#;re not eligible for premium-free Part A, as well as Part B and Part D. You can also pay Medicare Advantage premiums with HSA funds, but you cannot pay Medigap premiums with tax-free HSA money.) Or you might need the HSA funds to cover out-of-pocket medical expenses during retirement.

But if you end up needing long-term care, the cost is likely to dwarf the out-of-pocket medical expenses you had earlier in your retirement. Medicare doesn&#;t cover long-term care, and Medicaid only steps in if your income is low and you have exhausted almost all of your assets.

You can buy private long-term care insurance, but some people opt to treat an HSA as an investment earmarked for potential long-term care bills incurred late in life. If you don&#;t end up needing long-term care, your HSA can be passed on to your heirs, similar to a retirement account.

Clearly, there are a lot of advantages to an HSA. If you&#;re enrolled in an HDHP, it&#;s definitely in your best interest to set up an HSA and fund it. And if you don&#;t currently have HDHP coverage, it&#;s well worth considering as a future option.


Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since She has written dozens of opinions and educational pieces about the Affordable Care Act for mynewextsetup.us Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

Источник: mynewextsetup.us
 What Is The Difference Between A K and an IRA?

What’s the big deal? Why is an HSA beneficial? 

HSAs provide taxpayers with a great way to reduce their tax bill and to save for the inevitable healthcare expenses. Whether you itemize or take the standard deduction, you can deduct all the contributions to your HSA, except those made by your employer. 

Contributions made through a so-called “cafeteria plan” may also be excluded from your income. A cafeteria plan - sometimes called a Section Plan - refers to a selection of certain tax-advantaged benefits that employers allow qualified employees to choose from.

Certain HSAs allow you to invest the funds so that they can grow in index funds and ETFs. These earnings on your HSA contributions will also grow tax-free. As long as you use your HSA funds to pay qualified medical expenses, you do not have to pay any taxes. 

For instance, say you contributed $3, on your HSA and the fund earned $ during the year. If your effective tax rate is 32% and you didn’t receive the tax benefits of the HSA, you would have paid $1, on that amount in income tax and $30 in capital gains tax (on the $ capital gain). Instead of using that money to pay the IRS, you can keep it in your HSA and use it for healthcare expenses. 

Moreover, HSAs are portable. If you change jobs or become self-employed or unemployed, your HSA stays with you. It is not “use it or lose it.” 

You can make the maximum HSA contribution for that year as long as you become eligible on the first day of the last month of your tax year (which for most taxpayers is December 1).

Related Article

Purdue HSA Medical Plans

Employees who elect any of Purdue's Consumer-Driven Health Plans (CDHP) &#; Premier, Standard, or Limited &#; may be eligible to participate in an HSA &#; a bank account set up in the employee's name to which Purdue contributes funds that may be used for eligible medical, prescription, over-the-counter, vision, and dental expenses incurred by the accountholder as well as their eligible dependents (e.g., spouse, IRS-qualifying child &#; one they can claim on their taxes) during their HSA coverage period.

HSAs offer a triple-tax benefit:

  1. You can contribute to them on a pre-tax basis (lowering your taxable income).
  2. Your balance grows tax-free interest over time as it is a true savings account.
  3. You can make tax-free withdrawals and distributions to cover qualified medical expenses.

These funds roll over from year to year with no limit and the account follows the accountholder, even if they leave Purdue employment. Once a certain balance is reached, funds may be invested. Additional benefits to having an HSA are summarized here, in "The Anatomy of an HSA".

Are you eligible for an HSA?

Enrollment into a Purdue CDHP does not guarantee your eligibility for an HSA - there are additional IRS rules which may impact you. To get individualized guidance through these rules, please use our Interactive HSA Tool.

You may also refer to a quick HSA Eligibility Checklist.

Employees who are already 65 or who will turn 65 during the plan year should note that special rules apply to anyone who draws Social Security benefits and/or is covered by Medicare. Please take a few minutes to watch this video which walks you through your choices and what they mean for your Purdue health coverage and HSA, Thinking about Medicare?

Note: The information from the Interactive HSA Tool does not constitute tax or legal advice. If you have specific questions about the implications of an HSA for yourself, you are encouraged to seek professional tax or legal counsel.

If you are not eligible for an HSA, this does not impact your ability to enroll into a Purdue CDHP &#; only into an HSA. Purdue offers Health Reimbursement Arrangements (HRA) for those who are not eligible for an HSA for any reason.

Customer Identification Program (CIP)

Before you can access your HSA funds, HSA Bank is required to validate your identity through a Customer Identification Program, or CIP, process (all banks are required by federal regulation to do this when a person is attempting to open an account).&#;

Typically, your identity is verified with no issues.&#; Occasionally, however, more information is needed to further verify your identity. Most often this occurs when there has been a recent change in your name or address. In this case, HSA Bank will reach out up to three times to request two unique forms of identification which must come directly from you.&#; This documentation can be submitted to HSA by mail, fax, or by uploading to their secure website.&#; The details of what is needed and where to send it will be found in the letters from HSA Bank if you fail the CIP process or you can call HSA Bank using the number on the left side of the page.

You will not be able to access your HSA funds until you have pass the CIP process.&#; Additionally, if the requested documentation is not received by HSA Bank within 60 days, your account will be closed and any contributions made to it will be returned over time (based on the contribution date), less taxes.&#; If this happens, you will need to take extra steps to reopen the account, must pass CIP, and any missed contributions from Purdue would only apply going forward, beginning with the date the account is reopened.&#; Questions should be directed to HSA Bank at

Their first validation begins with a physical residential address; therefore, if you've only listed a P.O. Box address in our system, you will need to update your address before your account can be opened.

HSA Contributions & Contribution Limits

The contributions and limits shown below assume you are eligible for the HSA all year. If not, the amounts would be prorated. Changing plan tiers midyear (i.e., from family to individual) will also impact your contributions and limits.

Purdue Base Contributions

Purdue will make contributions to your HSA based on your medical plan enrollment. This is done incrementally in conjunction with your pay schedule &#; monthly (for fiscal or academic year pay schedules) or bi-weekly, and academic-year staff do not receive contributions in the months of May through August when they don't receive full pays.

Note: For those enrolling in an HSA midyear, these contributions will be prorated based on your remaining number of pays in the year.

The following amounts will be reflected in the "HSA Savings ER" line under the "Purdue-Paid Benefits" section of each of your pay statements:

  • $ for employee-only coverage
  • $ for family coverage (employee + one or more)

Learn how you can earn additional HSA funds through our Healthy Boiler program.

Optional Employee Contributions

You can elect to set aside dollars on a pre-tax basis through payroll deductions for your HSA as long as the total combined contributions from any source (e.g., your deductions, Purdue base, Healthy Boiler wellness program) do not exceed the IRS contribution limits below. You are encouraged, but not required to make your own contributions to an HSA and may change your payroll deductions at any time during the plan year without a Qualifying Life Event (changes may take pay periods to reflect on your paycheck).

IRS Contribution Limits

You are responsible for assuring that total contributions to your HSA from all sources combined do not exceed the limits below. As a reminder, these assume you are eligible for the HSA all year. If not, the amounts would be prorated. Changing plan tiers midyear (i.e., from family to individual) will also impact your limits. Your age may also affect your limits. See Catch-Up Contributions in the next section.

Spouse tip: If your spouse also receives or makes contributions to an HSA through Purdue or another employer, you must collectively adhere to the contribution maximum family limit.

  • $3, for employee-only coverage or $7, for family coverage (employee + one or more)

  • $3, for employee-only coverage or $7, for family coverage (employee + one or more)

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Catch-up Contributions

Federal rules also allow what are called &#;catch-up&#; contributions to an HSA. If you are age 55 or older, or will turn 55 any time during the plan year, you may contribute an additional $1, above the IRS limits in the previous section.&#;

Spouse tip: Eligibility to make catch-up contributions is based on the accountholder's age &#; not on their spouse's age. If the accountholder and the spouse are both 55 or older, the accountholder may still only make a $1, catch-up contribution.

Account Management

For detailed instructions on managing your account online (e.g., check your balance, reimburse yourself for eligible expenses paid out-of-pocket, pay a bill, link your bank account) at mynewextsetup.us, review HSA Bank's Member Website Guide. You may also access your account on the HSA Bank mobile app.

Interest and Investment Opportunities

Health Savings Accounts are interest-bearing accounts. With HSA Bank, you have the opportunity to potentially increase your funds by taking advantage of their investment options. For more information, please review HSA Bank Self-Directed Investment Options.

Tax Forms Information

HSA Bank tax forms will be made available online at mynewextsetup.us from the &#;View Statements&#; link on the Message Center tab and you will receive an email from HSA Bank when they are posted. They will not be mailed out automatically unless you opt into receiving paper copies. To opt in, log into HSA Bank, scroll down to the &#;Quick Links&#; box, and click &#;Statement Preferences.&#; In the Statements section, place a checkmark under "Paper" in the HSA Tax Documents row. You may also call HSA Bank at to request a paper copy. Be sure to verify your address on file with Purdue is up to date first.

SA

  • Posted by January 31
  • Reports funds distributions (You will not receive this form if you did not withdraw/spend funds from your HSA in the prior tax year)
  • Required to report on IRS form when filing tax return&#;

SA

  • Posted in May
  • Reports contributions to your HSA made in the prior tax year along with your HSA balance as of the end of December in the prior tax year
  • Informational only and is not required to file with your tax return

Additional Resources

HSA Frequently Asked Questions

The IRS regulates the requirements for health plans to be eligible for an HSA and the rules associated with participating in/receiving contributions to an HSA. Enrollment into any of Purdue's Consumer-Driven Health Plans (CDHP) - Premier, Standard, or Limited does not guarantee your eligibility for an HSA and this&#;web page&#;is not intended to provide all the information you need to make a decision on whether or not an HSA is right for you. You may want to consult with a tax advisor.

For questions specific to the Healthy Boiler Wellness program (earnings, timing of payment), visit the HSA/FSA/HRA section of the Healthy Boiler FAQ.

For specifics on the features and functions of managing your HSA online, please refer to the HSA Bank Member Website Guide.

Eligibility

To receive contributions to an HSA with Purdue, one requirement is enrollment in one of the Consumer-Driven Health Plans &#; Premier, Standard, or Limited. Additional rules around eligibility are complex. To help determine whether you may be eligible for an HSA, please use our Interactive HSA Tool.

After your HSA is established with Purdue, if you lose your eligibility to receive contributions to it mid-year, you must decline the account in order to stop your employer contributions. If you are losing eligibility by enrolling in a non-HSA-qualifying medical plan, you will not see the option to enroll in an HSA and therefore won't need to decline it.

In either case, your HSA will become a retail account (rather than an account connected with an employer) and you will become responsible for the monthly account maintenance fee. When this happens, you will receive a letter from HSA Bank regarding the change along with an updated Fee Schedule.

If you are no longer working at Purdue, you will not be able to make or receive pre-tax contributions to your HSA. Your HSA funds will remain yours to keep and you can still use them free of taxes and penalties, provided they are spent on eligible expenses. Your HSA will become a retail account and you will become responsible for the monthly account maintenance fee. When this happens, you will receive a letter from HSA Bank regarding the change along with an updated Fee Schedule.

The IRS prohibits individuals from participating in both an HSA and a health care FSA or HRA (allows reimbursement for eligible medical, prescription, over-the-countervision, and dental expenses, like the HSA). The only FSAs Purdue offers which do not affect your HSA eligibility are Limited Purpose FSAs (eligible vision and dental expenses only) and Dependent Care FSAs (eligible childcare expenses only).

Spouses may not each enroll in an HSA and a health care FSA or HRA at the same time. Therefore, if your spouse is enrolled in a health care FSA or HRA, you would not be eligible to enroll in an HSA.

Account Basics and Contributions

An HSA is an FDIC insured bank account with a triple tax advantage in which eligible employees may participate. First, your contributions to the account are pre-tax, second, withdrawals and distributions from the account are tax-free when the funds are used properly, and third, interest earned on the funds in the account along with any growth and interest following investment is tax-exempt.

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When you enroll in an HSA, Purdue will send your information to HSA Bank.

In order to open a bank account, HSA Bank is required by law to validate a person's identity. Their first validation begins with a physical residential address; therefore, if you've only listed a P.O. Box address in our system, you will need to update your address before your account can be opened.

Once your account is opened, the rest of your data is verified through HSA Bank's Customer Identification Program, or CIP, and your account is ready to receive contributions. Occasionally, however, more information is needed to further verify your identity. Most often this occurs when there has been a recent change in name or address. In this case, HSA Bank will reach out to request verifying documentation from you directly.

It is possible to incur fees with your HSA (e.g., by ordering additional debit cards after the first two, over-drafting). You can view a summary of these fees online through your HSA Bank account by logging into HSA Bank, clicking Resources from the menu bar, then clicking View Fee Schedule.

This is done incrementally in conjunction with your pay schedule &#; monthly (for fiscal or academic year pay schedules) or bi-weekly, and academic-year staff do not receive contributions in the months of May through August when they don't receive full pays. The amount will be reflected in the "HSA Savings ER" line under the "Purdue-Paid Benefits" section of your pay statement.

During the annual open enrollment period in the fall, when electing an HSA, you will have the option to make your own contributions and can enter the annual amount you'd like to contribute. Purdue will divide that amount by your number of pays, deduct it incrementally from your pay before taxes, and submit those funds to HSA Bank for deposit.

The number of pays for a full year are as follows: 12 for the fiscal payroll schedule, 8 for the academic payroll schedule, and 26 for the bi-weekly payroll schedule. Those on the academic payroll schedule will not have HSA deductions taken the months of May and August.

You are encouraged to contribute to your HSA via payroll in order to maximize your tax benefits as that way you wouldn&#;t pay federal income or Social Security and Medicare payroll taxes; however, if you are unable to contribute via payroll or would prefer not to lower your IRS-reported taxable income which may impact your future Social Security benefits, you are allowed to make post-tax contributions to your account. This way you will get back federal income taxes when filing your taxes, but you will not get back the payroll taxes.

You have until the tax-filing deadline each year (4/15) to do one of the following:

    1. Complete the HSA Contribution Form for HSA Bank and mail it to them with a check. Note: Be sure to mark the appropriate contribution tax year. For example, if you are contributing to your account in , you will check the box for Prior Year.
    2. If your HSA is linked with your personal bank account, you may do an electronic funds transfer. Instructions on electronic funds transfers and on linking a bank account to your HSA are found in the HSA Bank Member Website Guide. If you are contributing outside of the current year, be sure to select the applicable tax year for the contribution.

As a reminder, you are responsible for ensuring the total contribution amount that goes to your HSA each year does not exceed the IRS maximum for that year &#; Purdue does not track contributions made to your HSA outside of payroll. Questions around this process can go to HSA Bank at () and questions around taxes should be directed to a tax advisor.

Yes.

For , a person with individual/self-only medical coverage may have HSA contributions up to $3,, and a person with family/self-plus-one-or-more-dependents medical coverage may have HSA contributions up to $7,&#;

&#;

Funds contributed in excess of your IRS contribution limit and the earnings on those funds are subject to penalty and tax unless you take one of the following additional actions. It is recommended you speak with a tax advisor.

  • Pay the excise tax on the excess contribution when filing your Federal Income Tax Return for the prior year. The funds would remain in your HSA and count as a current-year contribution; therefore you&#;d need to make sure you subtract the excess amount from the following year&#;s IRS HSA limits to determine the maximum amount you can contribute that year to avoid further penalties.
  • Complete an HSA Excess Contribution Removal Form and return it to HSA Bank by the tax-filing deadline. The excess amount will be removed from your account and refunded to you, less taxes.&#; Questions on this process may go to HSA Bank at .

Yes. If you reach a minimum balance of $1, in your HSA, you can transfer funds above that amount to an investment account at HSA Bank. There are account fees and additional expenses associated with the investment accounts, depending on which option and investments you choose.

See "Interest and Investment Opportunities" earlier on this page for more information.

If you are still participating in an HSA while actively employed with Purdue at age 65 and have not enrolled in Medicare, you may continue to make or receive contributions to your HSA.; however, when you retire and enroll in Medicare after age 65, you are retroactively entitled to Medicare for up to 6 months, but no sooner than the first of the month in which you turned This means any HSA contributions made to your account after your Medicare entitlement date will be considered taxable income. Additionally, a mid-year loss of eligibility will affect your contribution limits. It is recommended to consult a Tax Advisor for more information.

Note: Drawing benefits from Social Security at 65 and up requires enrollment into Medicare Part A which affects your ability to make or receive contributions to your HSA.

Upon turning 65, you may use your HSA funds on Medicare Parts A, B, and D premiums. Additionally, if you use or withdraw your HSA funds for non-eligible health care expenses, you will not be subject to the 20% tax penalty, but will be responsible for paying taxes on the amount spent.

You are asked to designate your beneficiary when you first log in online at mynewextsetup.us&#; To update, log in and click View Account Details under your Health Savings Account, then click My Profile under the My Health Savings Account menu on the left and you will see the Beneficiaries tab on the following page.&#; You may also complete the HSA Designation of Beneficiary Form and return it to the address at the bottom of the form.

If you are married, your spouse may become the owner of the account and can use it as his/her HSA. Another option is that the account may no longer be treated as an HSA, and will be passed along to your beneficiary or become part of your estate. For specific details on this subject, consult a tax advisor or estate attorney.

Enrollment in an HSA requires you to complete IRS form when you complete your taxes on an annual basis. Be sure to discuss this with your tax preparer.

See "Tax Forms Information" earlier on this page, just before the HSA FAQs for more information.

Accessing Your Funds

HSA Bank will issue you a debit card for your HSA or will sync your HSA to your HSA Bank card if you already have one from other account. You can also set up payments to a health care provider, order checks, and request reimbursements from your HSA to yourself from the member portal at HSA Bank.

If you incur out-of-pocket expenses and do not have funds available in your HSA to cover those costs, you will need to pay by other means. You can reimburse yourself after each pay period when funds are deposited in your HSA until you are paid back in full.

When you use your card at a vision or dental office, funds will first be pulled from your Limited Purpose FSA until it is exhausted and then it will use your HSA funds. This distinction is made through the provider's merchant category code (number assigned to businesses based on their services offered) which is recognized when your card is used. When you use your card anywhere else, your HSA funds will be spent.

Eligible Expenses

Only the following premiums are considered eligible expenses for which you can use your HSA funds: COBRA continuation of health care coverage; health care coverage while receiving unemployment compensation; long-term care coverage (up to the annual amount allowed by age); and for those age 65 and older, Medicare health care coverage including Medicare Parts A, B and D.

Health insurance premiums for coverage offered through an employer and premiums for Medicare supplemental plans, such as Medigap are not considered eligible medical expenses.

Источник: mynewextsetup.us
 8 Ways to File Your Taxes for Free

What can I use the money in my HSA for?

You can use the money in your HSA for qualified medical expenses not covered by your insurance for yourself, your spouse of any of your qualified dependents.

Qualified medical expenses may include payments for medical and dental services such as doctor’s fees, laboratory fees, prescribed medicines, and necessary surgeries. Expenses for purely cosmetic reasons such as facelifts and health transplants are not typically considered qualified medical expenses. 

Take note that you have to keep your receipts for at least three years. Unless the IRS suspects fraud, they will not typically request records beyond three years.

If you withdraw funds for any purpose other than for qualified expenses, the distribution becomes taxable. In addition, you’ll have to pay a 20% penalty. 

How do I use the money in my HSA?

Method 1 - Debit Card

A health savings account usually comes with a debit card that is often a Visa or common credit card. You can use your HSA debit card to pay the pharmacy or your medical provider. You may also use your debit card to pay qualified medical expenses in cash or pay through online fund transfer.

Method 2 - Reimbursement

You may request reimbursement for medical expenses you paid using your personal funds. Your HSA will mail you a check or do a direct deposit to your account. There is no time requirement to request reimbursement from your HSA provider. If the funds in your debit card are not enough to cover your medical expense, you can claim reimbursements for eligible expenses you paid with your personal funds. 

You should keep all receipts related to your medical expenses to prove that your HSA funds were used for qualified expenses in case of an IRS audit.

Can I open an HSA outside of my employer or does it have to be through my workplace health insurance?

Yes, you can open an HSA without the help of your employer as long as you have an HDHP. In this case, you have to pay after-tax dollars on your HSA. But you can recover the taxes you paid when you submit Form HSA Contributions and Deductions and claim the HSA deduction in your annual tax return.

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HSA Distribution

An HSA distribution is a withdrawal from your health savings account. HSA distributions taken to pay for eligible medical expenses are not taxable, but still must be reported to the Internal Revenue Service (IRS). If you take a distribution for purposes other than paying for covered medical expenses, it can have serious tax consequences, as you will be taxed on the withdrawn funds at your ordinary income tax rate and could potentially also owe a 20% penalty. 

Here's what you need to know about HSA distribution rules and your obligations to the IRS when you make them. 

Piece of paper labeled HSA with calculator and pen sitting on it.

Image source: Getty Images.

What is an HSA distribution?

An HSA distribution is a withdrawal of money from your health savings account. This could take the form of a debit card transaction, a check, or a direct transfer of funds from your HSA into another financial account.

HSA distributions are classified into two categories:

  • Qualified HSA distributions: These occur when you use money from your HSA to pay for an eligible medical expense, either by paying the provider directly via debit card issued by your HSA or by paying a provider with your own money and submitting receipts to your HSA for reimbursement. 
  • Non-qualified HSA distributions: These are distributions from your HSA used for any purpose other than paying eligible medical expenses. The distribution will be taxed as ordinary income and, if you are not yet 65 years old, you will generally also pay an additional 20% tax penalty to the IRS.  

Here is the HSA distribution form for

When you take money out of your HSA for any reason, the HSA trustee or custodian must prepare an IRS Form SA. The trustee or custodian who holds your account must complete this form regardless of whether the money from your HSA is sent directly to you or to an eligible medical provider after you receive medical services. The trustee or custodian must indicate the amount of the distribution on the form as well as whether it was a normal distribution, a return of excess contributions, a distribution made after the account holder became disabled, or a distribution made after the account holder's death. 

The trustee or custodian will send a copy of IRS Form SA to you, as well as to the IRS. In turn you will need to use the information on IRS Form SA to complete IRS Form , which must be included with your form when you file your taxes if you have an HSA.

Form both allows you to inform the IRS of your HSA contributions and your distributions and helps you calculate whether any portion of your distribution is taxable and/or subject to the 20% penalty for nonqualified distributions. 

Qualified HSA distributions

Qualified HSA distributions are distributions made for eligible medical expenses, and are thus not subject to either income tax at your ordinary rate or to the 20% penalty for nonqualified distributions.

Eligible medical expenses generally include those that would generally be considered tax deductible if you meet the threshold for deducting medical expenses. IRS Publication has a detailed list of what medical expenses you can pay with HSA funds in order for the distribution to be considered qualified. They include prescription drugs, most types of dental care, chiropractic care, acupuncture, fertility treatments, eyeglasses and contact lenses, service animals, and more. 

HSA distributions and taxes

HSAs are a very valuable type of investment account because you can make contributions with pre-tax funds, allow your money to grow tax-free, and make tax-free withdrawals for medical expenses. Most other tax-advantaged accounts, such as IRAs and (k)s, allow either pre-tax contributions or tax-free withdrawals -- not both, as the HSA does. 

Although a qualified HSA distribution is not taxable, you still must file IRS Form to report any distributions made during the year.

However, if you have made nonqualified distributions because you took money out of your HSA that you did not use to pay for eligible medical services, you will be taxed on the distribution at your ordinary income tax rate. If you have not yet reached age 65, you will also be subject to a 20% penalty on the withdrawn funds.

Those who are 65 or older may make nonqualified distributions without incurring the extra penalty, paying only ordinary income tax. In other words, HSA distributions made after age 65 are treated like those made from a (k) or traditional IRA. Because of this added flexibility, HSAs are often used as a retirement savings account. 

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ATM/debit cards and HSA debit cards

Request a new card

  • Cards arrive within 7–10 days.
  • Transactions are reflected in your Available to Withdraw balance and are posted to your account within 5 business days.
  • Additional HSA debit cards are mailed directly to the account owner's address.
  • Purchases are deducted daily from your HSA.
  • You can find more information about qualified medical expenses on the IRS website.

Replace a card

You can request a replacement card on the Fidelity debit cardLog In Required page if your card was:

  • Lost or stolen
  • Not received
  • Damaged or cannot be read

For cards that were lost or stolen, prompt action is recommended to protect your account from unauthorized activity. You may also use the Lock card feature if you need time to search for the card.

For cards nearing expiration, your new card is sent automatically on or before the 15th of the expiration month on the front of your card.

Replacement cards arrive within 7–10 days.

Change or create a PIN

You can create or change a PIN onlineLog In Required.

Account owners can change the PIN on additional HSA debit cards but will not be allowed to change the PIN on another account owner’s card.

New and updated PINs can be used immediately after they have been successfully submitted.

You can change your PIN once per day.

Set up travel notifications

You can notify us of your travel plans onlineLog In Required, whether you’re traveling in the US or overseas, to help reduce the likelihood of being declined for purchases and transactions.

Travel plans can be provided up to 90 days in advance of your travel date. You can also go online to change or delete previously entered travel plans.

Note: Travel notices established by calling Fidelity will not be available online. To change or delete these plans, please call Fidelity Debit Card Services using the number located on the back of your debit card.

When you use the card in a foreign country, a 1% foreign transaction fee may be included in the amount charged to your account; this charge may apply whether or not there is a currency conversion.

Customers calling from outside the US should use the number on the back of their card to call collect.

Lock my card

To protect your card from use or if it’s been lost or stolen, you can place a temporary lock on your card onlineLog In Required . You may go online to unlock your card at any time.

Locking the card will prevent any new withdrawals or purchases. Recurring transactions, returns, and credit adjustments will still be allowed.

View card limits

ATM/debit cards are issued with daily withdrawal and spending limits. HSA debit cards are issued with daily spending limits.

You can view the daily limits and remaining balance associated with your debit card on the Fidelity debit cardLog In Required page.

  • Daily limits reset each day at midnight ET.
  • Daily limits are subject to the Available to Withdraw balance in your account and specific daily transaction limits.

Unblock a debit card or report unauthorized transactions

Call Fidelity Debit Card Services using the number located on the back of your debit card to address any debit card transaction issues.

Customers calling from outside the US should use the number on the back of their card to call collect.

Close a card

You can close your debit card on the Fidelity debit cardLog In Required page.

If there are recurring transactions paid with the card, please provide updated payment information to the merchant(s) before closing the card.

Once you submit the request, your existing card will no longer work.

Once closed, you should destroy the card by cutting across the magnetic stripe and chip.

Источник: mynewextsetup.us

Top 10 reasons to use health savings accounts

You&#;ve probably heard of health savings accounts (HSAs), and you may have wondered if one would be a good fit for you. You aren&#;t alone.

According to a survey released in , approximately 30 million Americans have chosen to use a health savings account coupled with a high-deductible health plan (HDHP) to pay for current and future healthcare costs. More than half of American workers with employer-sponsored health coverage were enrolled in HDHPs as of (some people have an HDHP but opt not to open an HSA; you&#;re allowed to contribute to an HSA if you have HDHP coverage, but are not required to do so).

HSAs have increased in popularity since their debut in Understanding the increase in enrollment isn&#;t difficult when one takes a closer look at how HSAs work and the impressive array of benefits they offer to people willing and able to use them.

Who can utilize HSAs?

In order to contribute to an HSA, you need to be covered under a high-deductible health insurance plan, either obtained through your employer or purchased on your own. The majority of large employers offer an HDHP option (70% did so in ), and HDHPs are available for purchase in the individual market nearly everywhere in the country. (That means you can have an HDHP and HSA even if you buy your own health insurance. An employer doesn&#;t have to be involved.)

Once you&#;re enrolled in an HDHP, you can open an HSA (or sign up for the one your employer uses) and begin making contributions. And if you&#;re on the fence about whether it&#;s the right move for you, here are some things to keep in mind:

1. HSAs offer a triple tax advantage

The HSA is a rare breed in terms of tax-advantaged accounts:

  • The money you put into your HSA is pre-tax.
  • While the money is in your HSA, there&#;s no tax on investment gains or interest earned in the account.
  • And then when you withdraw the money, it&#;s still tax-free – as long as you use it to pay for qualified medical expenses.

Contributing to your HSA reduces your ACA-specific modified adjusted gross income, which is important to keep in mind if you’re buying your own coverage in the health insurance marketplace/exchange. The higher your ACA-specific MAGI, the smaller your premium subsidy will be (normally, there&#;s an income cap for subsidy eligibility, equal to % of the poverty level; that&#;s been eliminated for and as a result of the American Rescue Plan). You might find that an HSA contribution makes you eligible for a larger premium subsidy. Here’s more about how this works.

2. Paying medical expenses with pre-tax dollars

Once you&#;ve put money in your HSA, you can withdraw it at any time to pay for a qualified medical expense. And qualified medical expenses go well beyond the out-of-pocket costs for services that are covered by your health insurance plan. They also include includes things like dental and vision costs, as well as products like sunscreen (SPF 30+), bandages, and lip balm.

If you don&#;t have an HSA, you can only deduct medical expenses by itemizing your deductions on your tax return. And even if you itemize, you can only deduct medical expenses that are in excess of % of your income.

3. Your HSA can be a backup retirement account

If you withdraw money from your HSA before you turn 65 and you&#;re not using it to pay for qualified medical expenses, you&#;ll have to pay income tax and a 20% penalty. (Don&#;t do this unless it&#;s a dire emergency!)

But once you turn 65, that 20% penalty no longer applies. You can continue to use your HSA funds for medical expenses, avoiding taxes altogether on the withdrawals. But if you choose to withdraw the money for other purposes, you&#;ll just pay income tax. This is similar to how a traditional IRA works in terms of taxes. (Note that with a traditional IRA, you can start to withdraw money penalty-free at age , whereas with an HSA, you have to be )

And unlike traditional IRAs, you&#;re not required to start taking money out of your HSA when you turn If you want to leave it in the account to continue to grow, you can do that.

4. Pre-tax contributions &#; regardless of your income

Although you can think of your HSA as a backup retirement account, there is no income limit – on the low end or the high end – for deducting HSA contributions.

This is not the case for IRAs: There&#;s an income limit for Roth IRA contributions, and an income limit for being about to contribute pre-tax money to a traditional IRA if you also have a retirement plan at work. And both require you (or your spouse) to have enough earned income to cover the contributions.

But to contribute to an HSA, you just need coverage under an HSA-qualified high deductible health plan (HDHP) without any additional major medical coverage, and you can&#;t be claimed as a dependent on someone else&#;s tax return. Your income isn&#;t a factor.

5. The money in your HSA continues to grow &#;

With an HSA, there&#;s no &#;use it or lose it&#; provision. This is one of the primary differences between an HSA and an FSA. If you put money in your HSA and then don&#;t withdraw it, it will remain in the account and be available to you in future years.

6. &#; and you can choose how your HSA grows

HSA funds can be kept in basic interest-bearing accounts – similar to a regular savings account at a bank or credit union – or, if you choose an HSA custodian that offers it, you can invest your HSA funds in stocks, bonds, or mutual funds.

There&#;s no single right answer in terms of what you should do with the money in your HSA before you need to use it. If you&#;re planning to withdraw all or most of your contributions each year to fund ongoing medical expenses, an FDIC-insured institution might be the best choice. The account will likely only generate small amounts of interest, but it will also be protected from losses.

On the other hand, if you&#;re looking at your HSA as a long-term investment and your risk tolerance is suited to the stock market&#;s volatility, you might prefer to invest your HSA funds. Note that most HSA owners do not have their HSA funds invested. For some, this is a calculated decision based on their risk tolerance and their need to access the money in the near future. But for others, the account might serve them better if the funds were invested, but they simply don&#;t understand the options available to them.

If you buy your own HDHP, you can select from any of the available HSA custodians. (Pay attention to fees, investment options, and expense ratios, as is always the case with investment accounts.)

If you have an HSA through your employer, you might be limited to using the HSA custodian that your employer has selected, at least as far as your employer&#;s contributions go. And HSA contributions made via payroll deduction are typically free of income tax and payroll tax. You can&#;t avoid payroll taxes if you make your own HSA contributions outside of your employer&#;s payroll.

But you&#;re free to establish a separate HSA on your own, and transfer money out of the HSA your employer selected, and into the one you picked yourself. The IRS considers this a transfer, instead of a rollover, so there are no limits on how often you can do this.

Ready to try out a Health Savings Account?


7. You can leave your job and take your HSA

If you have an HSA through your employer, the money in the account is yours. When you leave your job, you get to take the remaining HSA balance with you. This is another difference between FSAs and HSAs.

You can choose a new HSA custodian and transfer the money if you wish. There are no taxes on the HSA money you take with you when you leave your job, unless you withdraw the money and don&#;t use it for medical expenses.

8. Deductibles aren&#;t necessarily higher than other plans

You must have a high-deductible health plan (HDHP) in order to contribute to an HSA. And it&#;s understandable that the term &#;high-deductible&#; makes people nervous. But the deductibles aren&#;t necessarily higher than the deductibles for non-HDHPs, and in some cases, they&#;re even lower.

For , IRS regulations require HDHPs to have deductibles of at least $1, for an individual and $2, for a family. But average deductibles for Bronze and Silver plans in the individual market are considerably higher than that. Among people who have employer-sponsored plans that include deductibles (about 85% do), the average deductible for a single employee is nearly $1,

And the maximum out-of-pocket limits for HDHPs are lower than the maximum out-of-pocket limits for other plans – a difference that is getting wider with each passing year. In , the HDHPs have to cap out-of-pocket costs at no more than $7, for an individual, and $14, for a family. In contrast, ACA regulations allow non-HDHPs in to have out-of-pocket limits as high as $8, for an individual, and $17, for a family.


So although HSA-qualified plans are officially &#;high-deductible,&#; they sometimes have deductibles and out-of-pocket limits that are lower than other available plans. It&#;s possible to find HSA-qualified plans at the Bronze, Silver, and Gold metal levels if you&#;re shopping for your own coverage.

And as time goes by, HDHPs may start to cover more services before the deductible, for people with certain chronic conditions. Until , HDHPs were limited to covering only preventive care before the deductible (ie, prior to the insured meeting the minimum deductible amount that the IRS sets each year), and the definition of preventive care was updated in to align with the preventive services that the ACA requires all non-grandfathered health plans to cover.

But in July , in response to an executive order that had been signed the month before, the IRS issued new guidelines for preventive care that can be covered before the deductible on an HDHP without forfeiting the plan&#;s HSA eligibility. Under the new rules, an HDHP can cover, pre-deductible, certain specific health care benefits for people with certain chronic conditions and the health plan can remain HSA-eligible (assuming it meets all of the other requirements for HSA-eligibility. For people with the following chronic conditions, these services can be covered before the deductible on an HDHP:

  • Congestive heart failure or coronary artery disease: ACE inhibitors and/or beta blockers
  • Heart disease: Statins and LDL cholesterol testing
  • Hypertension: Blood pressure monitor
  • Diabetes: ACE inhibitors, insulin or other glucose-lowering agents, retinopathy screening, glucometer, hemoglobin A1c testing, and statins
  • Asthma: Inhalers and peak flow meters
  • Osteoporosis or osteopenia: Anti-resorptive therapy
  • Liver disease or bleeding disorders: International Normalized Ratio (INR) testing
  • Depression: Selective Serotonin Reuptake Inhibitors (SSRIs)

Note that HDHPs are not required to offer any of these benefits pre-deductible, unless a state decides to require it on state-regulated plans. These are benefits that go above and beyond the federally-required preventive care services, so whether to offer these services pre-deductible will be up to each insurer. But offering them will not cause a plan to lose HDHP status, which would have been the case prior to July

9. There&#;s no deadline for reimbursing yourself from your HSA

When you pay a medical bill and you have an HSA, there’s nothing that says you have to pull money out of your HSA to cover the medical bill. And there’s also no time limit on when you can reimburse yourself. As long as the medical expense was incurred after you established the HSA, and you didn’t take it as an itemized deduction, you can reimburse yourself years or decades later — after letting your HSA funds grow in the meantime.

So imagine that you’re contributing to your HSA each year, and also spending a few hundred or a few thousand dollars each year in medical expenses. You pay those bills from your regular bank account, keeping careful track of how much you pay and retaining all of your receipts.

Now let’s say that you decide you want to retire a few years early, before you can start withdrawing money from your regular retirement account. At that point, you can gather up all of the receipts from all the medical expenses you’ve paid since you opened your HSA, and reimburse yourself all at once (this is why it’s so important to keep your receipts — if you’re ever audited, you’ll need to be able to show that the amount you withdrew from your HSA was equal to the amount you had paid in medical bills over the years).

The money you withdraw is still tax-free at that point, since all you’re doing is reimbursing medical expenses (again, be careful not to withdraw more than you&#;ve spent in documented medical expenses; if you do, you&#;ll have to pay income tax and a 20% penalty on the excess withdrawal). But because you waited a few decades to reimburse yourself, you’ve given the money in your HSA many years to grow, tax-free, resulting in a potentially larger stash of funds.

Your HSA can be your long-term care fund

If you&#;re healthy and don&#;t have much in the way of medical expenses, you can think of your HSA as a really long-term investment. You&#;ll have to stop contributing to it once you&#;re enrolled in Medicare, but the money that&#;s already in the account at that point can continue to grow from one year to the next during your retirement.

You might find that you want to use your HSA funds, tax-free, to pay Medicare premiums. (That&#;s Part A if you&#;re not eligible for premium-free Part A, as well as Part B and Part D. You can also pay Medicare Advantage premiums with HSA funds, but you cannot pay Medigap premiums with tax-free HSA money.) Or you might need the HSA funds to cover out-of-pocket medical expenses during retirement.

But if you end up needing long-term care, the cost is likely to dwarf the out-of-pocket medical expenses you had earlier in your retirement. Medicare doesn&#;t cover long-term care, and Medicaid only steps in if your income is low and you have exhausted almost all of your assets.

You can buy private long-term care insurance, but some people opt to treat an HSA as an investment earmarked for potential long-term care bills incurred late in life. If you don&#;t end up needing long-term care, your HSA can be passed on to your heirs, similar to a retirement account.

Clearly, there are a lot of advantages to an HSA. If you&#;re enrolled in an HDHP, it&#;s definitely in your best interest to set up an HSA and fund it. And if you don&#;t currently have HDHP coverage, it&#;s well worth considering as a future option.


Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since She has written dozens of opinions and educational pieces about the Affordable Care Act for mynewextsetup.us Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

Источник: mynewextsetup.us

Rules for Having a Health Savings Account (HSA)

Does your health insurance come with deductibles in the four figures? If so, you're probably eligible to establish a Health Savings Account (HSA). Used in combination with a High-Deductible Health Plan (HDHP), funds deposited in a HSA can go towards paying medical bills until the plan's deductible is met and your healthcare coverage goes into effect.

HSAs were established in , as part of the Medicare Prescription Drug, Improvement, and Modernization Act. These savings accounts have become an increasingly popular option for consumers seeking to manage their healthcare costs. They also work as a tax-advantaged savings tool as well.

Key Takeaways

  • HSAs let you set aside pre-tax income to cover healthcare costs that your insurance doesn't pay.
  • You can only open and contribute to a HSA if you have a qualifying high-deductible health plan.
  • For , the maximum contribution amounts are $3, for individuals and $7, for families (for , the maximum contribution amounts are $3, for individuals and $7, for family coverage.) If you are 55 or older, you can add up to $1, more as a catch-up contribution.
  • HSAs have no use-it-or-lose-it provision. Any funds still in the plan at the end of the year can be rolled over indefinitely.

Who Can Open a Health Savings Account?

According to federal guidelines, you can open and contribute to a HSA if you:

  • Are covered under a qualifying high-deductible health plan which meets the minimum deductible and the maximum out of pocket threshold for the year
  • Are not covered by any other medical plan, such as that for a spouse
  • Are not enrolled in Medicare
  • Are not enrolled in TRICARE or TRICARE for Life
  • Are not claimed as a dependent on someone else's tax return
  • Are not covered by medical benefits from the Veterans Administration
  • Do not have any disqualifying alternative medical savings accounts, like a Flexible Spending Account or Health Reimbursement Account

What Qualifies as a High-Deductible Health Plan?

Generally speaking, a HDHP is a healthcare plan that trades relatively low premiums for relatively high deductibles, as its name implies. To qualify for a HSA that can be opened in combination with a HDHP, the HDHP must meet certain criteria. The IRS establishes guidelines each year, adjusting the figures for inflation. In and , a HSA account can only be opened if the account owner’s plan meets the following qualifying criteria:

and High-Deductible Health Plan Rules
IndividualsFamilies
Minimum Deductible$1,$2,
Out-of-Pocket Maximum* (includes deductibles, co-payments, co-insurance)$6,$13,

*Note that the out-of-pocket maximum is also designated by the plan. It can include deductibles, co-payments, and co-insurance. It does not include insurance premiums. The out-of-pocket maximum will usually also not include out of network services.

How Does a Health Savings Account Work?

Contributions to a HSA are tax-deductible. This means contributions will be deducted by payroll for employer-sponsored plans. For other individuals, mainly the self-employed, deductions can be taken when tax filings are made for the year.

Withdrawals from a HSA are tax-free provided they're used to pay for qualified medical expenses. These expenses can include payments for dental and vision care—expenditures that some standard medical health insurance plans may not cover.

Most HSAs issue a debit card, so you can pay for prescription medications and other eligible expenses with the card. If you wait for a bill to come in the mail, you can call the billing center and make a payment over the phone using your debit card.

Any money that is in your account at the end of the year remains in your account to pay for future qualified medical expenses. End of year balances are carried over indefinitely. The account and its funds belong to you, and you retain ownership even if you change health insurance plans, change jobs, or retire. While it's in the account, the money grows tax-free.

How Much Can I Contribute to a HSA?

The IRS sets limits that determine the combined amount that you, your employer, and any other person can contribute to your HSA each year. For , the maximum contribution amounts are $3, for individual coverage and $7, for family coverage (rising to $3, for individuals and $7, for families in ). You can add up to $1, more as a "catch-up" contribution if you are age 55 or older.

How Can I Use HSA Money?

The funds in your HSA can be used to pay for qualified medical expenses incurred by you, your spouse, and your dependents. The IRS establishes what is and what is not a qualified medical expense, detailed in IRS Publication , Medical and Dental Expenses. Generally speaking, qualified expenses include nearly any medical expense you may incur, such as amounts paid for diagnostics, cures, mitigations, treatments, and prescribed preventative medications.

One of the greatest benefits of the HSA is that it can be used to make payments that count towards your deductible. Moreover, the HSA serves as a type of tax shelter, meaning you won’t pay any taxes on the money you contribute. This saves you the taxable amount while allowing you to put those funds towards medical expenses you would have likely paid anyway with after-tax dollars. Keep in mind that you can also use the account for more than the expenses you incur under your main health insurance plan. For example, if your medical plan doesn't cover dental or vision care, HSA funds could still be used for those bills.

There are a few things that a HSA cannot be used for. You can't use it to pay insurance premiums. Other ineligible expenses include over the counter items like toothpaste, toiletries, and cosmetics, as well as most cosmetic surgeries. A vacation to a healthier climate would also not be an option.

Over the counter costs that don't require a prescription are generally not allowed such as the costs of toothpaste, toiletries, and cosmetics, as well as nicotine gum or nicotine patches.

If you're 64 or younger and withdraw funds for a non-qualified expense, you'll owe taxes on the money (which will be taxed as income), plus a 20% penalty. If you're 65 or over, or disabled at any age, you'll still owe taxes on the amount but be spared the penalty. So, frankly, after age 65, you can essentially withdraw HSA funds for anything.

How Can I Set Up a HSA?

You first need to enroll for a HDHP. If you take that step through your employer's human resources department, it should be able to advise you on creating your HSA. Most employer-sponsored HDHPs have an associated HSA provider for you to work with.

If a HSA does not come with your HDHP, you can setup the account on your own. Banks, credit unions, and brokerages all offer HSAs. Each HSA provider can create their own terms. HSAs through a brokerage can allow you to potentially invest your contributions in stocks, bonds, or funds. Bank HSAs will usually offer an optimal interest rate.

Once you select a provider, the enrollment process is fairly straightforward: You will be required to complete an application with information on your HDHP. Once your account is approved you can fund the account and begin using it for qualified expenses.

HSAs as Savings/Investing Tools

HSAs offer a tax shelter. For savvy investors this can create an opportunity to accumulate capital gains that can be withdrawn tax-free for medical expenses. Investment options, of course, can become more important if you have a larger HSA balance.

Most HSA account holders will want to be somewhat conservative with these funds since they are intended for necessary, planned and unplanned medical usage. This can limit the types of investments an account holder may want to make with their HSA contributions to mostly low risk products like Treasuries, municipal bonds, or high-grade corporate bonds.

The type of account opened will dictate the type of investments that may be available. Plans provided through banks usually offer no more than high yield interest savings terms. Brokerage plans however, offer much more. Some of the top HSA investment platforms that you may want to research include Vanguard, HSA Bank/TD Ameritrade,  Lively, Optum Bank, and Health Savings Administrators.

Who Benefits Most from a HSA?

HDHPs and HSAs often make the most sense for people who are relatively healthy with minimal expectations for annual healthcare costs. HDHPs usually offer lower premiums for the tradeoff of higher deductibles that would need to be paid if an emergency arises. This is what makes the combination of a HDHP and HSA very beneficial. Plan owners can potentially save indefinitely through a HSA for any emergencies that may require a high deductible payment.

HSAs and HDHPs can also appeal to high income earners as well as individuals nearing the age of High income earners choosing a HDHP can potentially use HSAs to save up to $8, per year in a tax-sheltered account. For both high income earners and those approaching retirement, the HSA can be a worthwhile vehicle for building a medical emergency fund while also saving in a type of alternative retirement vehicle.

Conversely, be aware that if you incur substantial health costs for standard medical care, the high-deductible health plan required to open a HSA might not be the right choice for you. Even though you will pay less in premiums with the HDHP, it could be difficult—even with money in a HSA—to come up with the cash to meet the deductible for a costly medical procedure.

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can i withdraw cash from hsa debit card
can i withdraw cash from hsa debit card

Health Savings Account

Tools to Manage Your HSA

  • Elements HSA Visa® Debit Card

    (1 of 5)

    Safely pay for qualified medical expenses, including prescriptions and doctor visits, among other health-related purchases with your Elements HSA Visa® Debit Card.

    Open an HSA Account

  • HSA Portal in Elements Online Banking

    (2 of 5)

    Once you have opened your Elements HSA, you will have access to the HSA Portal within Online Banking and the mobile app. You can use Online Banking to reimburse yourself from your HSA for payments made from your other Elements accounts or use Bill Pay to pay providers that don’t accept Visa. You can also track online account balance and transaction information.

    Log In to Can i withdraw cash from hsa debit card HSA Portal through Online Banking

  • HSA Advisor

    (3 of 5)

    Our smart bot provides actionable feedback about how you can get the most benefit from your HSA.

  • Link Your Credit Can i withdraw cash from hsa debit card of 5)

    Linking your personal credit and/or debit cards to your HSA allows you to use your usual payment methods for healthcare—then pay yourself back from your HSA at any time. You can link your cards in the HSA Portal.

    Log In to Your HSA Portal through Online Banking

  • Deductible Tracker

    (5 of 5)

    Link your health plan (ex. Blue Cross Blue Shield) account, to take the guesswork out of your progress against your deductible.

So, what exactly is a Health Savings Account (HSA)?

A Health Savings Account (HSA) is a tax-advantaged medical savings account available to taxpayers in the United States who are enrolled in a high-deductible health plan (HDHP). An HSA allows you to pay for current health expenses and save for future medical and retiree healthcare expenses on a tax-free basis. Contributions, earnings, and distributions are all exempt from federal income taxes when funds are used for qualified medical expenses.

You can use the HSA to cover expenses related to your High Deductible Health Plan until you meet your deductible. After your deductible has been met, your health plan coverage will then pay all or a portion of your medical costs, depending on the benefit design of the health plan. Any excess funds available in the HSA may be used for other qualified expenses, including dental and vision costs. Funds may also remain in the HSA to grow for use in future years.

Open an HSA

What can I do in the HSA Portal?

Once you have opened your Elements HSA, you will have access to the HSA Portal within Online Banking and the mobile app. The Portal enables you to keep all of your can i withdraw cash from hsa debit card information, like paperwork and receipts, in one place, which makes for easy retrieval and reference later. Here’s a glimpse at other tools available through the HSA Portal: 

  • Dashboard — overview of your balances and progress toward the HSA yearly limit.
  • Deductible Tracker — link your health plan (ex. Blue Cross Blue Shield) account, to take the guesswork out of your progress against your deductible.
  • HSA Advisor — provides actionable feedback about how you can get the most benefit from your HSA.
  • Link Your Credit Card — link personal credit and/or debit cards to your account so that no HSA purchase goes uncaptured. You can also link your savings or checking account for easy reimbursements.
  • Investment Account — view your investment account totals and move money to and from your TD Ameritrade account.
  • Health Care Blue Book — a can i withdraw cash from hsa debit card consumer guide to help you determine fair prices in your area for health care services such as surgery, hospital stays, doctor visits, or medical tests.
  • mynewextsetup.us — the only site exclusively focused on health savings accounts, and it’s the easy way to shop for HSA-eligible over-the-counter products. Using this online store takes the guesswork out of what products are eligible.

Note, the HSA portal is provided through a partnership between Elements Financial and Bend Financial.

Log In to Your HSA Portal through Online Banking

What are can i withdraw cash from hsa debit card investment options?

Elements Financial HSA members have access to an investment program through TD Ameritrade. Those who do not plan to use all of their HSA funds for current year medical expenses may wish to consider investing HSA dollars for potential added savings.

In order to enroll in the investment program, you must have an account balance of at least $2, in your HSA at the time of enrollment. Eligibility does not constitute enrollment in the program. You must actively elect to enroll in order to use the investment funding provided to you through TD Ameritrade. To begin the enrollment process, log in to your HSA through mynewextsetup.us From the left navigation menu, select “Investment Account” from the navigation bar and follow the prompts.

Post enrollment in TD Ameritrade, you’ll be able to move any amount over $2, from your HSA account to your TD Ameritrade investment account. If your HSA account balance goes below $2, you will not be able to move additional funds to your investment account.

If you wish to learn more about investment options, visit the HSA Portal Document Center in the HSA Portal, which can be accessed by logging in to Online Banking or the mobile app. There you can review the Investment Program details. Note that an active Elements Health Savings Account is required to access the HSA Portal Document Center.

If you have any questions about the TD Ameritrade investment program, including enrollment and transfer of funds, please contact the HSA Customer Support Center for assistance at HSA ().

How do I open an account?

Getting started is as easy as !

  1. Open an account online -Open an account online in as little as 10 minutes. Or call to get started. Have your government-issued ID (driver’s license, state ID, or passport) and your Social Security number ready.
  2. Check your email -You will receive an email within one business day to notify you of account approval. That’s it! Your Health Savings Account is now open and ready for contributions from your employer.
  3. Enroll in Online Bankingto access the HSA Portal -The HSA Portal allows you to manage your HSA account. The HSA Portal is accessed within Online Banking or the mobile app. Enroll in online banking to easily access the portal from your smartphone, tablet, or computer. Learn more about Online Banking.

Open an HSA

Where can I find HSA forms?

See below for a list of form PDFs that can help you get started.

Looking to Learn More About HSAs?

If you’d like to better understand how you and your family can take full advantage of your Health Savings Account, visit our HSA Welcome Kit page on our website. It’s full of helpful information about HSAs.

Read more frequently asked questions about Health Savings Accounts…

Whom do I call if I have HSA questions?

Our Customer Support Center is available to answer questions about your HSA and assist you with your High Deductible Health Plan (HDHP) or for questions about the HSA Product or Portal:

  • By Phone — Call us toll-free at HSA () Available am to pm Eastern Time, Monday through Friday

I already have an HSA? Can I transfer it to Elements?

Yes! It’s easy to transfer your existing balance to Elements. Call one of our team members at 8am-5pm Eastern to learn how.

How are deposits made to my HSA?

If the HSA is offered through your work, your employer can deduct the amount from each paycheck for deposit into the account. If you wish to make other deposits, call the HSA Customer Support Center at for deposit instructions.

What IRS reporting will I have to do each year for tax purposes for my HSA account?

You will need to complete IRS Form to be filed with your Form income tax filing each year, whether you itemize your deductions or not. This form reports your deposits and withdrawals from the HSA account. We provide an online workbook based on your account usage to assist you with form completion. This is provided for informational purposes only and is not considered tax advice. For specific assistance with tax reporting of your HSA account, please see your personal tax advisor. Elements will send the SA for distributions to arrive at the end of January and the SA for contributions to arrive at the end of May.

Health Savings Accounts

If you’d like to better understand how you and your family can take full advantage of your Health Savings Account, visit our HSA Welcome Kit page on our website. It’s full of helpful information about HSAs, including eligibility, funding your HSA, paying for healthcare, taxes, investment options, how to use the HSA Portal, and more.

View the HSA Welcome Kit

I am glad that my workplace partners with Elements for our HSA. The online portal is so easy to use and saves me tons of time.

- Chris D.  What Is The Difference Between A K and an IRA?

What’s can i withdraw cash from hsa debit card big deal? Why is an HSA beneficial? 

HSAs provide taxpayers with a great way to reduce their tax bill and to save for the inevitable healthcare expenses. Whether you itemize or take the standard deduction, you can deduct all the contributions to your HSA, except those made by your employer. 

Contributions made through a so-called “cafeteria plan” may also be excluded from your income. A cafeteria plan - sometimes called a Section Plan - refers to a selection of certain tax-advantaged benefits that employers allow qualified employees to choose from.

Certain HSAs allow you to invest the funds so that they can grow in index funds and ETFs. These earnings on your HSA contributions will also grow tax-free. As long as you use your HSA funds to pay qualified medical expenses, you do not have to pay any taxes. 

For instance, say you contributed $3, on your HSA and the fund earned $ during the year. If your effective tax rate is 32% and you didn’t receive the tax benefits of the HSA, you would have paid $1, on that amount in income tax and $30 in capital gains tax (on the $ capital gain). Instead of using that money to pay the IRS, you can keep it in your HSA and use it for healthcare expenses. 

Moreover, HSAs are portable. If you change jobs or become self-employed or unemployed, your HSA stays with you. It is not “use it or lose it.” 

You can make the maximum HSA contribution for that year as long as you become eligible on the first day of the last month of your tax year (which for most taxpayers is December 1).

Related Article Member since

Источник: mynewextsetup.us
 When Is It OK To Withdraw Money Early from Your K?

Scenario 3: You Prefer To Take Personal Possession Of Your HSA


You may also rollover your employer-sponsored HSA to a personal account. You should receive a check from your old HSA trustee if you do a rollover. You need to deposit this check to your new HSA within 60 days from receipt. 

If you don’t deposit the funds within this period, you would have to pay the 20% penalty for nonqualified distribution!

In addition, you may only do a rollover once every 12 months. There are usually charges for transferring your account to a new provider which may range from $15 to $ 

Rollovers should not affect your annual HSA contribution limit. You should also report rollovers on Form  

An HSA can be a great, tax-advantaged say to save for inevitable medical expenses regardless of your current health. Since they are highly portable and can be used in the US or abroad, you should duly consider contributing to your HSA if you are eligible. 



Get Started

Источник: mynewextsetup.us
 Can I Freelance For A US Company While I Am On An H1B Visa?

If you are on an H-1B, saving in an HSA is a great idea.

Everyone will eventually incur health expenses and an HSA is a great way to save for those expenses in a tax-advantaged way. HSAs are beneficial whether you incur health-related expenses in the US or back in your home country.

Non-citizens legally employed in the US can open an HSA or use their employer’s plan as long as they meet the high deductible health plan requirements. Most banks and HSA trustees will allow you to open an account if you have a Social Security Number and a valid US address. Can i withdraw cash from hsa debit card visa holders have Can i withdraw cash from hsa debit card and a valid address, so even if you have non-immigrant status, you can open an HSA.

Note: If you are eligible for your home country’s national health coverage, you cannot contribute to an HSA because it violates Rule #2 (no secondary insurance). For US citizens and permanent residents, for instance, you can’t contribute to an HSA if you enroll in Medicare.

If you are planning to stay in the US for more than a year, and if your health plan meets the high deductible requirements, it is a good idea to use an HSA to save for medical expenses. Take note that it’s not enough to open an account, you need to put money in it to activate your account. 

If you are only staying in the US for a year at most, it may not be worth the trouble to deal with the complexities of maintaining an HSA.

What happens to my HSA if I move back to my home country? Can I use the money for healthcare expenses outside the US?

When you leave for your home country, you have several options for what to do with your HSA.

Option #1: Leave your HSA and use it for qualified medical expenses

Even if you are no longer eligible for an HSA, you can still can i withdraw cash from hsa debit card tax-free distributions from the account although you can no longer contribute to the fund. You can also use your HSA as an emergency fund and use it for medical expenses in your home country.

In this case, you have to file a Form NR when you take HSA distributions for any year but you don’t have to pay any tax if the fund is used for qualified medical expenses.

If you use the debit card for your HSA abroad, you may have to pay conversion fees which can range from 1% to 3%. 

Option #2: Withdraw your HSA and pay the penalty

If you want to take your HSA savings when you leave, you have to pay taxes on your contributions and any interest earned. You also have to pay the 20% penalty since the distribution if not for a qualified medical expense. This penalty applies unless you are 65 or above or if you have a disability. 

Option #3: Wait until you are 65 before withdrawing your funds

Your HSA can serve as a retirement vehicle. When you reach 65, you can withdraw your HSA without paying the 20% penalty. However, you will still owe income tax on the distribution if not used for qualified expenses.

Related Article  8 Ways to File Your Taxes for Free

What can I use the money in my HSA for?

You can use the money in your HSA for qualified medical expenses not covered by your insurance for yourself, your spouse of any of your qualified dependents.

Qualified medical expenses may include payments for medical and dental services such as doctor’s fees, laboratory fees, prescribed medicines, and necessary surgeries. Expenses for purely cosmetic reasons such as facelifts and health transplants are not typically considered qualified medical expenses. 

Take note that you have to keep your receipts for at least three years. Unless the IRS suspects fraud, they will not typically request records beyond three years.

If you withdraw funds for any purpose other than for qualified expenses, the distribution becomes taxable. In addition, you’ll have to pay a 20% penalty. 

How do I use the money in my HSA?

Method 1 - Debit Card

A health savings account usually comes with a debit card that is often a Visa or common credit card. You can use your HSA debit card to pay the pharmacy or your medical provider. You may also use your debit card to pay qualified medical expenses in cash or pay through online fund transfer.

Method 2 - Reimbursement

You may request reimbursement for medical expenses you paid using your personal funds. Your HSA will mail you a check or do a direct deposit to your account. There is no time requirement to request reimbursement from your HSA provider. If the funds in your debit card are not enough to cover your medical expense, you can what credit score you need for amazon credit card reimbursements for eligible expenses you paid with your personal funds. 

You should keep all receipts related to your medical expenses to prove that your HSA funds were used for qualified expenses in case of an IRS audit.

Can I open an HSA outside of my employer or does it have to be through my workplace health insurance?

Yes, you can open an HSA without the help of your employer as long as you have an HDHP. In this case, you have to pay after-tax dollars on your HSA. But you can recover the taxes you paid when you submit Form HSA Contributions and Deductions and claim the HSA deduction in your annual tax return.

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Comments

  1. Hello 👋🏼 as far as the payment it says weekly amount but the top says payment none is that cause they have not sent out the card yet ?

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