by daziumdesign@gmail.com | Sep 15, 2021
Depending on your HRA’s plab design, an HRA can be set up to roll your funds from one plan year to the next. If your employer offers “fund rollover” it will be described in your Summary plan documents. Here’s how HRA fund rollover typically works: at the end of the plan year, you will have a certain amount of time (“run-out period”) to submit claims for services incurred during the prior year. At the end of the run-out period, or at a date set by your employer, all or a portion of your remaining funds may rollover to the next plan year or to a carryover account. Your employer may set the following rules:
1) A Percentage of remaining funds may rollover, such as 50%. So, if you have $512 on the fund rollover date, you can rollover $256.
2) A Maximum amount may rollover, such as $250. Taking the example above, only $250 would rollover of the remaining $512.
3) A Percentage up to a Maximum, such as 50% up to $250. Again, $250 would rollover, using the example above. If you had $300 remaining, then only $150 would rollover (50% of $300).
4) All funds – all remaining funds may rollover to the next plan year.
by daziumdesign@gmail.com | Sep 15, 2021
Each year, the IRS requires companies with pre-tax reimbursement accounts to complete nondiscrimination testing. Nondiscrimination testing ensures that the business owners and Highly Compensated Employee(s) (HCE) do not receive a disproportionate benefit from a pre-tax plan compared to other employees.
by daziumdesign@gmail.com | Sep 15, 2021
All “eligible employees” who received compensation during the previous year are included in nondiscrimination testing. Generally only union employees, non-resident aliens, leased employees and independent contractors can be excluded from nondiscrimination testing because they are not considered “eligible employees.”
by daziumdesign@gmail.com | Sep 15, 2021
Yes, you may have more than one HSA and you may contribute to them all, as long as you are currently enrolled in an HDHP. However, this does not give you any additional tax advantages, as the total contributions to your accounts cannot exceed the annual maximum contribution limit. Contributions from your employer, family members, or any other person must be included in the total.
by daziumdesign@gmail.com | Sep 15, 2021
Yes. You always have the option to choose when and when not to use your HSA dollars. You may pay for qualified medical expenses with after-tax dollars, allowing your HSA balance to grow tax-free. Many HSA participants elect to pay smaller expenses with after-tax dollars, allowing their balances to grow for the future. In fact, you can reimburse yourself at anytime in the future for eligible expenses you paid for using after-tax dollars as long as they were incurred while you had an open and funded HSA.
