HSA VANGUARD TO ROTH IRA
MY WIFE AND I HAVE A JOINT HSA VANGUARD ACCOUNT. I AM 61 Y/O AND WE PAY THE MAX ALLOWABLE PER YEAR.
FORTUNATELY WE ARE HEALTHY.
CLARK HOWARD AND OTHER NAME THIS HSA AS A STEALTH IRA.
CAN A PERSON TRANSFER A HSA TO A ROTH IRA?
IS IT A ONE TIME DEAL?
CAN A PERSON PAY THE TAXES JUST LIKE IT IS DONE WHEN WE TRANSFER A TRADITIONAL IRA TO A ROTH IRA?
Permalink Submitted by Alan - IRA critic on Tue, 2013-07-09 02:06
You might both have your own HSA accounts, but there are NO joint HSA accounts just like there are no joint IRA accounts. You can use an HSA to save for paying your medical expenses in retirement if you wish instead of paying current medical costs while you are working from your HSA. You can also make a one time qualified HSA funding contribution from your IRA (better your TIRA) if you wish, but you cannot do the reverse, ie transfer HSA funds to a Roth IRA. And you wouldn’t want to even if you could because a qualified Roth IRA can be distributed tax free for any reason, not just qualified medical expenses like an HSA. If you want to make the one time transfer from your TIRA to an HSA instead of making a regular HSA deductible contribution for that year, you can. Such a funding transfer is neither deductible or taxable.