Can You Keep HSA after Leaving job?
Leaving a job can be a stressful time. But one thing you may be wondering about is what happens to the money in your Health Savings Account (HSA). Fortunately, there are options for what you can do with an HSA after leaving a job.
Keep Your HSA After Leaving Job
Many people don’t know that they can keep their HSA after leaving a job. You can just switch the bank account linked to the HSA to a different one. This way, you can keep the money in your HSA and continue to use it for qualified medical expenses.
Roll Over to a New HSA
If you want to move to a new employer or just switch banks, you can roll over your HSA funds to a new HSA. You can do this up to once a year. This is a great option if you want to switch banks or start a new HSA.
Withdrawal Your Money
If you don’t need the money for qualified medical expenses, you have the option to withdraw the money from your HSA. Keep in mind that if you withdraw the money for non-medical expenses, you will have to pay a 20% penalty plus taxes.
Transferring Funds to an IRA
You also have the option to transfer your HSA funds to an IRA account. This is a good option if you want to invest the money or use it for retirement planning. Note that you cannot transfer funds directly from an HSA to an IRA. You must withdraw the funds from the HSA and then deposit them in the IRA.
Leaving a job doesn’t mean you have to let go of your HSA. There are several options for what you can do with your HSA, including keeping it, rolling it over to a new HSA, withdrawing the funds for qualified medical expenses, or transferring it to an IRA. Make sure to research all your options carefully before deciding.