Yes, you are correct! Thank you for clarifying that. I was confusing our HSA accounts with our RHRA accounts (Retiree Health Reimbursement Arrangement). The company that administrated our HSA's encouraged account holders to upload copies of the documents that supported their claimed expenses. It was not mandatory, but it was suggested as a safe and secure way of maintaining supporting evidence in case of an audit by the IRS. I didn't make use of that service but I can see why others might want to. The company that administers our RHRA's requires submittal of documentation.
Good question! We decided that spending our HSA's and not touching our Roth IRA's made the most sense. For us, it all boiled down to wanting to simplify our financial lives in preparation for our later years and wanting to let our Roth IRA's continue growing for our heirs. My wife and I each had our own HSA so there were two accounts to manage. My wife is technically challenged so I managed both accounts. If I were to pass away before my wife she would struggle with maintaining these accounts. Determining what qualifies for reimbursement and scanning and submitting receipts would be puzzling and frustrating for her. And managing these accounts could become more difficult for me in my later years if I begin to lose my mental abilities. So depleting the HSA's just made good sense to us. I hope this helps you out.
Comments
Yes, you are correct! Thank you for clarifying that. I was confusing our HSA accounts with our RHRA accounts (Retiree Health Reimbursement Arrangement). The company that administrated our HSA's encouraged account holders to upload copies of the documents that supported their claimed expenses. It was not mandatory, but it was suggested as a safe and secure way of maintaining supporting evidence in case of an audit by the IRS. I didn't make use of that service but I can see why others might want to. The company that administers our RHRA's requires submittal of documentation.
Post: The Luxury of Choosing Tax-Free Cash from a Roth IRA or HSA….but Which One?
Link to comment from November 14, 2024
Good question! We decided that spending our HSA's and not touching our Roth IRA's made the most sense. For us, it all boiled down to wanting to simplify our financial lives in preparation for our later years and wanting to let our Roth IRA's continue growing for our heirs. My wife and I each had our own HSA so there were two accounts to manage. My wife is technically challenged so I managed both accounts. If I were to pass away before my wife she would struggle with maintaining these accounts. Determining what qualifies for reimbursement and scanning and submitting receipts would be puzzling and frustrating for her. And managing these accounts could become more difficult for me in my later years if I begin to lose my mental abilities. So depleting the HSA's just made good sense to us. I hope this helps you out.
Post: The Luxury of Choosing Tax-Free Cash from a Roth IRA or HSA….but Which One?
Link to comment from November 13, 2024