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Comment by shmerl | Hacker News Reader

> The HSA thing intrigued me and so I did some digging. It appears that post-65, you still have to pay income tax on non-medical withdrawals from an HSA?

That's what I understood too. That claim that you can completely skip taxes looks wrong.

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You can completely escape taxes for any amounts that you have receipts for medical expenses incurred after the HSA was opened.

You can pay cash for a qualified medical expense in 2025 and take out that amount of money from the HSA decades later.

You can also use it to pay for Medicare premiums.

One thing to note!!!! Make sure to also keep records on the HSA start date and any transfers you may engage in, e.g., after leaving an employer or just changing providers. It is worth having that on record in case 20, 30, 40 years later your claims are rejected because the original opening date was lost in some transfer at some point.

But does this mean I need to keep receipts around for decades? What if a claim gets denied and dr. is dead or no longer practicing?

Has anyone tested this HSA claim approval amd reimbursement of 30/40/50 year old medical work before? Is there a chance the rules could change and the medical care has to be recent?

The HSA is like a bank or investment account, not an insurance program; there's no claim process; you just withdraw the money whenever you want at your say-so. There is only an IRS audit process if they think you acted against the rules of the HSA.

For keeping receipts, we have a process where we dump our eligible receipts into a folder on the NAS and have the scanner/printer setup with a one-button "medical scan" that also dumps paper bills into that folder. You only need receipts to substantiate your position during an audit if they decide to do one, so a big pile of receipts and a spreadsheet with the annual amounts is enough for my taste.

For a reduction of taxes at our full federal tax bracket plus our state income rate, it's worth keeping a folder on the NAS and pushing a button on the scanner a couple handful of times per year.

> Is there a chance the rules could change and the medical care has to be recent?

There's always a theoretical chance, but any prior (or likely then-current year) medical bills would almost surely still remain eligible for reimbursement. The worst case that I can see as being likely is a rule change to require that a 2026 expense would have to be claimed by April 15, 2027. But I wouldn't expect that and think there's precedent that they couldn't change the reimbursement eligibility for expenses incurred prior to the law change. US v Carlton is one where specifically a one-year period of retroactive change was found to be "supported by a legitimate legislative purpose furthered by rational means" which suggests to me (IANAL) that longer periods of retroactive change would likely be found to violate due process.

i’m the parent. You are correct, my mistake! It’s too late to edit at this point. :(

What I should have said is that after 65 you can spend it on non medical stuff without penalty. BUT if you do so you’ll owe tax that year (withdrawal).

So to summarize, you can avoid all tax if it’s spent on medical stuff. For non medical (post 65) it’s still good, but not as good.

Still an amazing deal because old people tend to spend a lot more on healthcare.

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