Rolling Over Your HSA
4 min read •
30 sec brief
The HSA Rollover. It sounds complicated, taxing and just plain frustrating. We will cover why Lively can eliminate all of these pains later, but rolling over your HSA to a new provider can provide lower fees, more enriched investment offerings and of course all the long-term value that comes with those features. Let us show…
Can I have Two HSAs?
There is a common misconception that you can only have one HSA, but that’s just not the case. For example, if your employer is making contributions, you could also have another existing HSA or open a new HSA to take advantage of more adventurous HSA features like no monthly management fees, self-directed trading or no debit card transaction fees. Find the HSA that works best for your financial and health savings future.
Yearly HSA Rollover Allowance
Before you consider an HSA rollover, you should know you can only roll over an HSA to another HSA custodian once every 12 months. This is not defined by plan or calendar year, but rather on a 12-month rolling basis. Once you receive your HSA rollover you have 60 days to deposit your HSA funds in your new HSA, according to IRS guidelines.
HSA Trustee-to-Trustee Transfers vs. HSA Rollovers
HSA rollovers are designated as a transfer from a trustee (like a bank, financial institution or HSA provider) to an individual and back to a trustee (like your new bank, financial institution or HSA provider). In contrast, HSA transfers are from trustee to trustee and there is no limit on how often you can do this. While this might seem like a similar experience for you, the HSA user, it has tax and HSA guidelines implications, so please talk to your HSA representative or a tax or financial planner for more information. While you might have completed your once yearly HSA rollover, you still could be eligible for an HSA transfer.
One-time transfer of funds from an IRA to an HSA
While we are on the topic of HSA rollovers, you should know you can roll over funds from your IRA to your HSA, but only once in a lifetime. In addition, the amount is limited to the maximum yearly HSA contribution ($3,400 for individuals and $6,750 for families in 2017 and an extra $1,000 if you are 55+) you qualify for in that year. Finally, to qualify you must have an existing HSA or an HSA-eligible health plan, so you can open an HSA. If you need more details or information, check out this recent post.
Reasons to Roll over your HSA
There are many reasons to roll over your HSA, but finding an HSA platform that lowers administrative fees and increases investment options has to be at the top of your list. Low or zero administrative fees (like we have at Lively for Individuals) ensure you aren’t being nickeled and dimed and that your HSA funds remain in your account so you can use the money when you need it most. HSA investments can help grow your HSA funds for the long-term and increased ROI.
How to Rollover or Transfer your HSA to Lively
Roling over your HSA sounds like a complicated process, so we decided to simplify it for you. Here is what you need to do:
- Sign up for Lively and complete your enrollment – we are free for individuals
- Complete your online HSA rollover form (as part of the onboarding process)
- That’s it! Lively will take care of the rest for you and let you know when the money is in your account.
HSA rollovers provide an opportunity to select the HSA that works best for your health savings needs no matter if that is for tax-free health savings for qualified out-of-pocket expenses or long-term savings that utilize HSA investments.
Ready to get started?
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