Click Here To Listen To The Retirement Tax Services Podcast


  • Kelley’s passion for HSAs and who she tries to educate about them. (1:38)
  • Things people don’t know about HSAs. (3:43)
  • HSAs vs. IRAs and max funding your HSA. (6:30)
  • The timeline for reimbursement. (8:52)
  • Employer contributions and self-contributions. (14:15)
  • A common misunderstanding about HSA distributions. (17:36)
  • What a super HSA is and how it works. (22:09)
  • Misunderstandings about contribution limits. (27:45)
  • Kelley’s best tips on getting your clients started with HSAs. (31:45)


Kelley Long, a CPA and self-proclaimed evangelist for Health Savings Accounts, joins Steven on the show today to talk about HSAs and her unique approach to talking to people about them. She shares how she goes beyond the basics and really gets through to people on how this can be such a valuable tool. Her insight and tips will allow you to bring new, next-level planning to your practice.

You will hear about how she became more well-versed on the ins and outs of tax planning, wealth planning, and cash flow planning strategies using HSAs. You will hear how you, as an advisor, can use HSAs to benefit your clients and help give them clarity and direction on how to best leverage it.

Ideas Worth Sharing:

I try to get the word out about the amazing superpowers of health savings accounts. - @kclmoneycoach Share on X Even though I think I’m already doing more than the average person, there’s deeper that we can go. This highlights the importance of finding specialists you can have in your network. - Steven Jarvis Share on X You can reimburse yourself up until – whenever! You can be like, 'In 2022, I bought a pregnancy test for 79.99 and I would like that 79.99 back now.' As long as you have the records, you can take it out. - @kclmoneycoach Share on X

About Retirement Tax Services:

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Read The Transcript Below:

We’re not overpaying. No, we’re not overpaying. We’re not overpaying anymore. The tax code’s complicated, boring, and overrated. You don’t want that, you want a pro. One thing that you should know: this is a radio show. It’s not tax advice, don’t take it that way.

Steven Jarvis:     Hello everyone, and welcome to the next episode of the Retirement Tax Services Podcast, financial professionals’ edition. I am your host, Steven Jarvis, CPA. And in this show, I teach financial advisors how to deliver massive value to their clients through tax planning.

Today, I’m really excited to have a fellow CPA on the show with me, Kelley Long, takes kind of the unique approach to what her focus is. Kelley, you’ll have to correct me if I’m wrong, but I believe you describe yourself as almost an evangelist for HSAs, of going beyond just the basics and really getting through to people of how this can be a valuable tool.

So, Kelley welcome to the show, do a better job than I did of explaining what it is you do.

Kelley Long:        Awesome. Thank you so much, Steven, for the introduction and for having me. I’m really excited to be here. And yes, I am a self-described HSA evangelist. I just, through a series of happenstance and career experience, have become more well-versed in the ins and outs of tax planning, wealth planning, and even just cash flow planning strategies, using Health Savings Accounts than I ever thought I would be.

And so, I’ve just really tried to get the word out about the amazing superpowers of Health Savings Accounts within the profession to my fellow financial planners and CPAs, and anybody in the personal finance world, as well as to just consumers in general, who tend to think of HSAs as a spending account or something that’s going to potentially leave them with a lot of medical costs because they don’t completely understand all of the ins and outs of how everything works together.

So, I’m really excited to talk about this. If I could just only talk about HSAs for the rest of my career, I’d probably be happy, as long as Congress doesn’t make rules that make a lot of the nuances go away, which would nice for all of as consumers. So, I’m not building my entire career around this, but it is something I’m really passionate about because I’m a big nerd like that.

Steven Jarvis:     Well, I’m a big nerd myself, I love having nerds on the podcast. And I do have to say right out of the gate, just to cut through some of the head trash for my listeners, I definitely was guilty at times of thinking of HSAs as a relatively simple tool that everyone understands, so we don’t need to spend a lot of time on it.

There’s been a few things that have always been on my checklist that I look for as I review tax returns and that certainly evolved over time, but I was able to attend a session you did at the AICPA Engage Conference. And it really opened my eyes to there is more I could be doing on this. Even though I think I’m already doing more than the average person, there’s deeper we can go.

And this highlights the importance of finding specialists that you can have in your network so that you can really see what next level planning on a specific topic looks like.

So, that’s why I’m excited for our conversation today because there are definitely things I was able to learn from your session that I just wasn’t aware of before. And some things were just kind of fine tuning how I approach it as well.

Kelley Long:        I think everybody knows that the Triple Tax-Free aspect of HSAs and most people are better at understanding that you should contribute the most that you can to the account, ideally, the maximum.

But I still regularly get questions from people asking, “How do I figure out how much to put in my HSA?” Because they’re still on that flexible spending account, which that’s where I always remind people, it’s the S, is the difference spending versus savings.

I would say as much as you can, ideally the maximum and particularly if you spend any money on HSA eligible expenses and it doesn’t have to be expensive medical procedures; it can be band-aids, it can be aspirin, it can be knee braces, it can be menstrual products. I mean, most fertile women are purchasing these things.

So, things that you’re already spending money on that you considered just to be like maybe grocery money, if nothing else, put that money into your HSA and then ideally, let it ride and treat it as a backup savings account because most people don’t realize that you can reimburse yourself after the fact up to whenever.

Like a hundred years from now if you’re still alive, you can go back and be like “In 2022, I bought a pregnancy test for 79.99 and I would like that 79.99 back now.” And as long as you have the records and with the IRS, you can take it out.

Steven Jarvis:     Kelley, there’s so many great details that clearly this is what you spend all your time on, because you’re just casually going through these as if these are common knowledge for everyone. But so many important things in there that it really is an expansive list of what qualified medical expenses count for being only use for HSA.

I love this point about there isn’t a time cap. If you’re keeping the receipts, you’re keeping the evidence we can … how you said until whenever. There literally isn’t a time cap of when you can go back and get these reimbursed.

And that’s so important because as you mentioned as well, you can invest those dollars. I hear advisors talk all the time about how HSAs are triple-tax advantage, but I find that often not, everyone’s actually taking advantage of all three of those tax advantages.

You actually have to invest those dollars inside the HSA to really benefit from the tax-free growth, because by default, those HSA funds are not going into investments.

In fact, for a lot of HSAs, you have to have a certain amount of dollars in there before you even can invest. And so, understanding some of those nuances are important, but even just knowing, “Hey, I have to take an intentional step to invest these dollars, so they do grow tax-free.”

And then the other piece that I like to remind advisors of, because I’ll get this pushback of … sometimes I’ll even push people to say, “Hey, you should …” if we have to choose between one or the other, I’ll push people to HSAs before I push them to IRAs.

And I’ll get people to say, “Wait a second, what good does it do me if I end up with a million dollars in HSA account?” To use a really extreme example — and my kind of pushback on that is, “Well, what harm does it do you?”

Because once we get to 65, we’re not paying any penalties if we use it for non-medical expenses. We’re going to pay tax, but that’s the same situation we’d be in for an IRA. So yeah, I’m a huge fan of advocating for max funding HSAs.

Kelley Long:        Yes. And I mentioned there’s congressional action when we’re preparing for this that might change some of this and make this conversation obsolete. And that is actually one area I’m often asked like, “Well, couldn’t the laws change?” Well, the laws could change on anything. They could change on Roth IRAs, like there might be riots.

But people have said, there’d be riots if they took away the tax-free nature of Roth IRAs or did means testing but then nobody rioted when we put the salt cap in place. So, like, that’s a problem for people in large cities who have dual incomes. But I’m digressing.

With HSAs, there is a … one of the ways that I have become an expert on this is how HSAs coordinate with turning 65, but people want to continue to contribute while they’re still eligible, assuming they’re still enrolled in an HSA eligible plan and that’s qualified for deferring Medicare.

There is a proposal in front of Congress and it’s a bill that comes up every once in a while. Sometimes it gets legs, but hasn’t passed and I’m not a huge follower of the tax policy until it really, really threatens to come into code.

But this bill does propose removing that 65 or that Medicare exception, which would then also eliminate that ability to withdraw penalty-free at the age of 65. So, I’m really split on if Congress passes a law that says, if you’re on Medicare, you can still contribute to HSAs, but then you also can’t take money out for anything besides medical expenses.

I’m split on which way I want it to go because it would be great if folks in their later years could continue to contribute if they’d like to and have those additional expenses tax-free. But then you would have to be a little bit more mindful of overfunding your account, unless there were some more friendly ways to pass along the accounts as well, perhaps.

Right now, if you pass away with money in your HSA — so, that’s the time to reimburse yourself by the way, the deadline at this point to reimburse yourself is death. And I actually had somebody ask me, “Are there deathbed reimbursements?”

Well, I guess I haven’t heard of an instance where this has been tested, but I can see a point where if you have somebody who has significant unreimbursed HSA expenses and they are imminently terminal, it might make sense to go ahead and pull that money out of the HSA, even if it’s going into the person’s estate because once they pass away, the ability to reimburse for their past expenses goes away because the account passes to the beneficiary.

If it’s a spouse, the spouse inherits the tax-free nature of it, they can continue to use it for their own expenses. And presumably, some of the receipts that that person had saved up would be for their spouse.

But if it’s a non-spouse beneficiary, it’s a just a taxable distribution. And so, it’s not an efficient way to pass along wealth. Roth IRAs are a more tax-efficient way, even regular IRAs, even in light of the Secure Act.

So, there are some downsides to accumulating massive amounts of money, but I’ve run the numbers before. And if somebody were to be listening to this and set themselves or a client or a child up at the age of 25 to max out their HSA and invest it aggressively and never spend a dime of it at 65, they’d still only have about 600,000 which is more than double what the projected cost of healthcare would be for a married couple at this point in time.

But that’s not a concern to me. Overfunding is not a concern to me. And in fact, when I give these talks in employee audiences, the benefits people are always like, “Don’t tell people they can spend their HSA on non-medical stuff.” Even in retirement, people are never going to have enough money. Don’t tell them they can buy a boat with their HSA, but you could.

Steven Jarvis:     Yeah. Just got to pay the tax. That’s a really good point about the … or at least, something to be aware about the proposed legislation that it’s out there. I tell advisors, I tell clients that we’re going to make the best plan we can with the laws that we know now.

And we’re going to pay attention to those kinds of things but I’m with you that I’m only taking action when those things actually become law, because I think in this particular case, this proposed legislation that’s come up multiple times, that’s never really gotten anywhere.

And yes, absolutely, the tax code is written in pencil. All of it is written in pencil. It could all change tomorrow. It’s totally possible that Congress changes all the rules and you have a client that comes to you tomorrow and says, “Wait a second, you made all these recommendations and now, I’ve got to pay whatever it is.”

And I’m going to feel good saying to that client, “You know what we did the best we could with the information we had available and now, we’re all in this position together.” I think that’s very unlikely but, yeah, it’s totally possible and there’s no point in trying to avoid that possibility.

Kelley Long:        Exactly. I made the HSA mistake myself when they first came out, my employer was a bank at the time and they had an HSA product, they were really excited about it. I was a CPA already, was in the wealth management department and even I missed it.

I was like, “No, why would I want to take a high deductible when I can have no deductible and pay $30 to go to the doctor?” Like I made that mistake for so many years and thinking that why would I take that risk on myself for my medical expenses, not recognizing that the deposit my employer was going to make in the HSA would’ve offset those initial costs, if I even had them.

And I didn’t understand the taxability. I understood there’s no use it or lose it, that the money carries over. But I still hear people saying, “Oh yeah, when I switch jobs or when I switched plans, because I had kids, I went ahead and used the rest of my HSA to get Invisalign or something.” And it’s like, “Why? You might someday re-enroll in an HSA eligible plan, you can reuse that account.”

So, I think that’s another area that I would like to clear up some misunderstanding, is your ability to contribute to a Health Savings Account is contingent upon you being enrolled in an eligible healthcare plan. And so, in that way, it’s tied to your health insurance, but that is the only way it’s tied to your insurance.

Otherwise, it’s more like an IRA, because it’s completely portable from the day you open it. Most people open their first HSA through a job, a provider that their benefits department chooses that’s tied to their insurance. But from that day one, they’re not required to use that provider. It’s preferred because if they want to make payroll contributions or their employer is making deposits, that’s going to go into that account, so you would keep it.

But if you’re going to make additional contributions outside of payroll, or you want to invest the money and you don’t like the rules around investments that are in place from your provider, you can move that money at any time and you can continue to contribute to the one that your job picked and continue.

You can have five HSAs if you want, I don’t know why you would. But you can have multiple accounts as long as you’re not contributing more than the annual limit in aggregate of all the accounts, including employer contributions on an annual basis.

Steven Jarvis:     Yeah. So, many seemingly simple things in there that get missed all the time, that we can really help clients move the needle on how much they’re saving in tax advantage accounts by really being on the lookout for some of these things. We can start as simple as, “Hey, did you know that you can make an HSA contribution potentially in addition to what your employer’s contributing?”

At least in my experience, I very seldom see taxpayers whose employer is covering the max eligible contribution. But I meet people all the time who have no idea that they can also contribute to make up the difference.

And so, in 2022, for someone who has family coverage, they can contribute up to $7,300 if they’re not eligible for the catch up yet. And so, I see it all the time, the employer might contribute 3 or $4,000 and the taxpayer assumes “Well, okay, great, that’s what I’m eligible for.”

Actually, we can make up the difference. A lot of times you can make it up through a payroll deduction and also get the benefit of not paying payroll taxes. But even if you have to make that contribution separately, you’re still avoiding income taxes.

So, great, now, we’ve just helped the client contribute another 3,000, 4,000, maybe even more a year to a triple-tax advantage account that over time, this is going to be meaningful dollars.

And that one year it might not seem like much, but over 10 or 20 or 30 years, this is suddenly a lot of money to potentially help fund one of their largest expenses in retirement. Taxes is going to be the largest, but medical for a lot of people is one of the largest expenses that they have in retirement.

Kelley Long:        And it’s the biggest wild card. And so, having a well-funded HSA going into retirement makes distribution planning for other accounts and tax planning from just a retirement tax perspective so much simpler because you have a lot more predictive ability over most expenditures.

Healthcare is the thing that throws off most plans, both in working years and in retirement. So, having that like pot of money in a separate place that you don’t have to worry about taxes is like almost like a little bit of a crystal ball from a perspective of distribution planning for all other types of accounts.

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Steven Jarvis:     And you touched on it, but I want to make sure this didn’t get lost on the audience, that a lot of people don’t realize that they’re under no obligation to spend their HSA funds every year.

On a regular basis, I will review tax returns where a client is making HSA contributions, great, that they’re maxing out their HSA contributions, even better. But then, I’ll see that they have large amounts of other income and are still taking the full distribution every year from the HSA.

And so, I’ll have this conversation of, “Hey, did you know that these funds can be invested and grow over time that you don’t have to spend them every year?” And it’s this eye-opening moment for a lot of taxpayers of, “Oh, I thought I had to spend that, absolutely, I could cover that through other cash flow, and then we could let this grow tax-free.”

But it’s just something they were never aware of before. No disrespect to the HR departments out there – most HR departments are not focused on tax planning, that’s just not their job. And so, they’re helping people understand the benefits available to them. They are not trying to be tax planners.

And so, they’re not even doing something wrong in my eyes, but most taxpayers are unaware that that is available to them. And so, again, a seemingly simple thing that can add thousands, if not tens of thousands of dollars over time to their account if you’re helping them realize that, “Hey, we can leave that invest, we can let it grow over time.”

You made the point earlier, maybe it was before we even hit record, of there is a tradeoff there, we don’t want people going into debt to pay for medical expenses so that their HSA can stay intact. But if there are other funds to cover those medical expenses, let that HSA account grow tax-free over time.

Kelley Long:        Even if you just keep your HSA funds in cash. And let’s assume that you have chosen a provider that at least pays you a small amount of interest on cash, and you’re spending your savings. And it’s the same interest rate. You’re better off in the HSA, because that interest is not taxed.

And so, just spending down your savings account over here and letting the money in here, and then if you need the money, let’s say you spend your savings account down, you drain it.

You had your gallbladder out, $4,500 bill from the hospital, you drain your $4,500 savings, you’ve got 4,500 in your HSA. Two months later, you need a hole patch in your roof, you got $4,500, you just pull it out of your HAS. The IRS asks for details, you show them your hospital bill.

So, to your point about the tax preparation, it reminds me of a tax preparation job that I had, where clients would give us their 1099 essays. And it would just show the amount that was deposited in the HSA. But the software we were using required us to also input how much was spent. And the senior person that I was working with was like, “Oh, you just assume they spent it all.”

And so, these people whose taxes we were doing, we were reporting to the IRS and they were spending down their HSAs. And so, we could have really cause some problems, because HSA audits are no fun.

And especially, if you are spending some of your HSA, but not all of it, the record keeping is on you and most providers are helpful in allowing you to upload receipts, but that isn’t necessarily a fill proof way to prove that your expenses were all qualified.

So, I take full responsibility for my own record keeping, but there is a higher requirement for record keeping and that’s probably one of the things that a lot of advisors have to figure out an easy way to help their clients overcome if they’re going to be recommending some of these strategies because not everybody’s as anal as we are.

Steven Jarvis:     Well, I want to take a quick tangent here and then we’re going to talk about super HSAs, because I’m really excited to hear your thoughts on that. Because you mentioned in there that this tax position that you were in, where basically you just assumed, hey, it was all spent, which I wish was more uncommon.

But what advisors need to understand is that tax preparation as a business model is often very, very high volume, very, very driven on how quickly can we get through these things, and taking the information they’re given and getting through it as quickly as possible.

And so, unfortunately, that situation you’re describing of “Here’s what the 1099 essay says, let’s make an assumption on the rest and let’s move on,” that’s very common.

And so, unless an advisor is proactively communicating with a tax preparer or happens to be working with a tax preparation service, like RTS that we’re actually taking the time to insist on that proactive communication, these things get missed all the time.

So, that tangent aside, Kelley, let’s talk about what a super HSA is.

Kelley Long:        Yes. A super HSA is a very unique but common circumstance where a family has a child that is still on their health insurance plan, but is no longer a tax dependent. So, generally speaking, the tax dependent rule say, once somebody’s 19, they’re no longer eligible to be your tax dependent. Or if they’re a full-time student, they can be your tax dependent up until the age of 24.

However, there’s no rules that say, if you have a 20-year-old who’s in college, that you have to claim them as a tax dependent. I remember negotiating this with my parents.

Like “I want my exemption” back at the time. And now, depending on the family situation, it may actually be more tax beneficial for the college student to be their own dependent.

Let’s just use the age of a 25-year-old, because that’s going to always fit. If you’re on your parents’ HSA eligible plan, your parents, whoever has the insurance can put up to the family limit into the HSA. But you as a non-tax dependent, even though you’re on the insurance plan, cannot use those HSA dollars.

So, HSA dollars can be spent in the year that they’re spent on anyone who’s a tax dependent. Which reminds me of another little-known fact is I put money away now, fast forward 20 years, my parents live with me. They’re my tax dependence. I could use my HSA in that year on my parents’ medical expenses.

But if I have a 20 … I know, right? So, also, if you are thinking you might be somebody who is going to be claiming a parent or really anybody as a tax dependent, then beefing up your HSA can help offset those costs as well.

Let’s say, I’m a 25-year-old college student or not even a college student. I’ve graduated, I’m out on my own. I decided to stay on my parents’ insurance, because it’s easier, it’s cheaper for whatever reason, and I have a medical expense. I can’t use my parents’ HSA because I’m not their tax dependent.

So, what do I do? “Oh, I can open my own HSA because I am enrolled in an HSA eligible plan.” And the common question or a common assumption is you would fund it for yourself, the individual limit.

But the IRS rules state that the limit is determined by the type of coverage that you have. And so, you have family coverage, which means that the child who is no longer a tax dependent, but is still on the family plan can put 7,300 into their own HSA as well.

Now, parents are probably going to have to gift that money at that age, most likely. That’s fine, they can gift the money. The child still gets the tax deduction. So, it’s not a tax planning move necessarily for parents, but for the child, assuming they have some income, they’ll get that full deduction.

And the parents can make the contribution and ideally, that child doesn’t spend the HSA and it’s even better than funding a Roth IRA for your newly graduated, new career, newly minted student or child who might have student loans that are prohibiting them from saving for retirement. Like this is a great way to kind of kickstart that plan, and they can invest the money or use it for their own expenses if they are at risk of debt.

So, let’s say you’ve got twins or triplets who are 25. Like each of them can fund their own. So, most people tend to think of it as just double the limit. But if you have more than one child who qualifies as eligible for your plan, so that’s affordable care act rules, and you’re not claiming as a tax dependent, then they can fund their own HSA to the family limit.

Steven Jarvis:     I was so excited when I heard you start talking about this, because I have no issue admitting that there are still things that I can learn. And this one was news to me because obviously, I knew that you could stay on your parents’ plan until you’re 25, that that option was available. But I just assumed that, hey, the contribution limits had to be for the plan as a whole, because I’d never taken the time to think about it differently.

And as soon as you explained it, my wheels started turning. I was like, “Oh, this makes so much sense.” Because for HSAs, first, we determine eligibility and then completely separately, we determine contribution limits. That’s just how the rules are written.

And so, yeah there’s so much opportunity here and I would even push back a little bit on your comment of maybe this isn’t great tax planning. If we’re only looking at the parents, then yes, they probably don’t come out ahead.

But I like to look at tax planning from the standpoint of the lifetime of your wealth, not even just your lifetime. And so, if you had goals of setting your kids up for success looking at what you’re going to leave for them and your legacy anyways, this could potentially be a great way to plan ahead to start setting your kids up for success. And now, we’re not just looking at that contribution limit of $7,300 for a family, but multiple times over, especially if we have more than one non-tax dependent child.

So, there’s definitely some nuance in there we want to make sure that we’re following the rules here, not just getting aggressive. This certainly does not mean that all of a sudden on form 8889, that we use to report HSA transactions, that you’re now overriding the software and putting $14,000 or whatever number you came up with — each of the kids who are going to need to claim this on their return.

There’s some nuance to it, but potentially, very, very powerful here of being able to get a lot of money into HSA accounts, all based on the same insurance coverage.

Kelley Long:        Yes. And I should know Steven that there are providers and even experts at well-known and used tax reference manual providers who say it’s the individual limit. I have actually gotten into email arguments with people at text book printers. I don’t want to say names.

And I’ve been quoted in the press about this and journalists have come back and they’re like, “Well, so and so at so and so says that it’s the individual limit.” I’m like, “Well, this is what the IRS, like this is on the website, this is in publication 969.”

So, if there’s a different interpretation, that’s fine. So, I’m pointing that out because if somebody were to call their HSA provider and say, “How much can I put in there?” They might hear the individual limit. It’s just like people call Medicare and getting seven different answers.

So, this is a very misunderstood area. And that whole separate account thing brings up one other little titbit about HSAs on the other end of the spectrum — oh, maybe not on the other end of the spectrum; which is when you have spouses who are both age 55 or older, so they’re both eligible for that catch up.

And assuming that both spouses are on one of the spouse’s plan, this is where the rules are just like frustrating, but also, job security for me. Is the person who has the coverage, the primary coverage holder is the person who can fund the HSA.

So, if I’m 55 and I have my spouse on my HSA eligible plan and kids or whatever, $7,300, $8,300 is what I can fund into mine. 7,300 for the family, plus a thousand dollars catch up. But what about myself who’s also 55?

Well, I can’t fund their catch up into my HSA, so they have to open their own and put a thousand dollars into it. And that’s another area where some practitioners may need to be caught up a little bit on how the rules work and the technicalities, but that’s how that works.

That’s how a couple could get $9,300 in the HSA, but unfortunately, they can’t split it. You just need to make sure that each other is named as the beneficiary of the account, and you can spend your HSA on each other as long as you’re married.

Steven Jarvis:     That’s a great reminder. That’s one I see all the time that I work with taxpayers on of making sure there’s that distinction there of an HSA, kind of like an IRA. It is an individual account. It has one person’s name on it as far as who the account owner is. We can name different beneficiaries, but even though my wife and I have a high deductible plan, we have an HSA, but we are not 55 yet.

So, we just have an HSA in my name that we use for our family, but when we get to 55, we’ll have to open a separate account for her to be able to take that catch up. And that gets missed a lot. And I see it done — to your point, I see practitioners on the tax preparation side do this wrong all the time.

Either they’ll stop at the 8,300 and say, “Well, there’s no way for us to go further,” Or they’ll try to game the system and get it wrong, and now, we have excess contributions and we create a mess for ourselves. But when we’re looking at both spouses being over the age of 55, we’ve got to have two separate accounts.

Kelley Long:        Yes, it’s a mess. And there was a time when my spouse and I were both like we each had our own plan, it didn’t make sense for us to be on the same plan together. And so, he has his own has.

But he was only on it for like two years, so it’s probably a little account. And then I have mine that I keep contributing all this money to, and it seems lopsided, but if my husband had a large expense, I could just spend my HSA on it if I needed to.

So, different from that perspective from an IRA — well, maybe not, I mean, I guess you can spend your HSA on your spouse too, but from an eligibility perspective.

Steven Jarvis:     Well, Kelley, I love being able to nerd out on these types of conversations and I think you and I could probably keep talking about this for the next couple of hours, but we want to make sure that we’re taking great information and turning it into value by giving people actions that they can take.

So, as you think about how the questions that you often get or the issues that you often see with HSAs, what are action items you’d recommend to financial advisors to make sure they are helping their clients when it comes to HSAs?

Kelley Long:        First of all, I would say, make sure that your clients are aware of all of the HSA eligible expenses that they are likely incurring and make sure they’re keeping record of that. Even if it’s just a box of receipts.

Second of all, of course, then not spending that money, but just kind of keeping a file to show you what your HSA future contributions are worth.

Second of all, invest that money immediately, as soon as possible. If you’re a more conservative person, maybe keep a thousand dollars, the amount of your deductible, your out-of-pocket if you’re really conservative in cash, if you’re really, really concerned.

But if you have significant cash savings outside of your HSA, it’s totally fine to go ahead and fully invest that HSA for growth.

And then finally, I would just say, make sure you’re double checking with your clients who have college age students and who are still on their plan and ask them if it makes sense for them to claim their child as a dependent that year from a tax perspective, or if it’s neither here nor there from a deduction perspective, from tuition or whatever, consider not claiming the child as a dependent so that they can fund their own HSA with the family limit.

Steven Jarvis:     So, that’s so great. The action item, of course, I always tag on is make sure you’re getting tax returns every year for all of your clients. That’s going to give you a lot of insight into what they’re eligible for, whether this is getting reported correctly.

This is the best way to see if they’re actually spending their HSA every year, because everybody thinks about this differently. They might not be thinking about the fact that debit card in their mind is really their HSA account.

So, get the tax return, make sure you’ve seen the detail. But I love those action items of making sure you’re educating your-

Kelley Long:        Lock that debit card up. Don’t even take it with you.

Steven Jarvis:     Make sure you’re educating your clients and around HSAs and the record keepings in particular, that we’re working with clients who invest to those balances and then checking to see if that super HSA is an option.

Kelley, before we wrap things up, I mean, one of your specialties is working both with consumers, CPAs, as well as financial advisors on really getting deep on answering questions, kind of being a consultant around HSA.

So, people listening to this episode, if they think, “Hey, that all sounds nice, but I’m still lost, how do I learn more?” How can someone reach out and connect with you directly to get your services around this?

Kelley Long:        Sure. My website is, I have a web page on my website dedicated to HSAs, and lots of resources of things I’ve written, other podcasts I’ve done on the topic. And I invite you to contact me with any questions.

And then my other kind of side of my business is I’m a financial coach. So, I’m not a financial advisor, I don’t manage money, I am not a registered representative. And so, for clients who might need help with kind of some of the basics with money, when it comes to maybe debts, payoff strategies, or just simple, hourly, basic money stuff, I also accept clients for that as well. So, I’m a great partner with most financial advisors.

Steven Jarvis:     That’s awesome. So, And we’ll include that in the show notes as well. Kelley, thanks so much for coming on the show-

Kelley Long:        And I’m on Instagram under the same.

Steven Jarvis:     Perfect. So, follow Kelley on social, go out to her website if you want to learn more. Like I said, Kelley, I really appreciate you being on the show today. It’s been great having this conversation with you. For everyone listening, thanks for being here. And until next time, remember to tip your server, not the IRS.

We’re not overpaying. No, we’re not overpaying. We’re not overpaying anymore. The tax code’s complicated, boring, and overrated. You don’t want that, you want a pro. One thing that you should know: this is a radio show. It’s not tax advice, don’t take it that way.


The information on this site is for education only and should not be considered tax advice. Retirement Tax Services is not affiliated with Shilanski & Associates, Jarvis Financial Services or any other financial services firms.

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