Hsa?

[multipass]

What happens with an HSA (health savings account) in BK7? We don't contribute money to one ourselves, but my husband's company deposits a certain amount each year (the amount depends on which tier of health insurance you choose during open enrollment). I don't know about other HSAs, but with this one all money is on a Visa debit card issued by our health insurance company that only allows purchases at places one might reasonably be expected to obtain medical care or supplies (eg: it works to pay doctors/hospitals but declines if we try to use it to pay a collection agency even if that debt originated as medical debt) We can't directly obtain cash from it at all. Also, we've had a lot of medical visits this year, so we've had to use most of what's on the card already.

[justbroke]

It really depends on whether or not there is an exemption to cover an HSA account.

Apparently, in Georgia, they are not exempt under State law. See Mooney v. Webster (In re Mooney) , 2017 BL 24780, 11th Cir., No. 15-11229, 1/27/17. That was an 11th Circuit case which was just decided in January of this year, so it's very recent. Unless you have some leftover wildcard exemption(s) then you may not be able to protect the HSA.

If you're planning to file through an attorney they may find some wildcard to help exempt a portion (or all of it). Someone will need to take a deeper look at all of your exemptions.

[multipass]

Thank you!

If they want to take the couple of hundred dollars left in it that's okay; I just hope we don't get in trouble for the amount we've already spent with it this year (all medically necessary - not like we were out having fun with it or anything lol).

[justbroke]

Did you file yet? If not, go spend it. (If you haven't filed, go to CVS/Walgreens/RiteAid/<insert your favorite pharmacy here> and purchase some OTC stuff and other medical items. Pre-fill some prescriptions. Make sure your doctor co-pays are all paid.)

"They" -- the Trustee -- will not care what you did with the HSA funds as that would be more an IRS issue if you used it on non-medical items and were caught in an audit.

[LadyInTheRed]

Check with an attorney. I wonder whether a BK trustee can get the HSA even if you don't exempt it. Assuming it can be used only for the healthcare of you and your family and you have no right to it for any other purpose, I suspect the trustee can't get it. I don't think the trustee can force you to pay for an asset that s/he cannot liquidate.

[TomJ1]

Did you file yet? If not, go spend it. (If you haven't filed, go to CVS/Walgreens/RiteAid/<insert your favorite pharmacy here> and purchase some OTC stuff and other medical items. Pre-fill some prescriptions. Make sure your doctor co-pays are all paid.)

"They" -- the Trustee -- will not care what you did with the HSA funds as that would be more an IRS issue if you used it on non-medical items and were caught in an audit.

HSA account money cannot be used for OTC items. You're thinking of FSA accounts.

[justbroke]

HSA account money cannot be used for OTC items. You're thinking of FSA accounts.

I was thinking of my OTC junk (Flonase, Vitamin D) that are prescribed. What is dumps is that Flonase isn't covered under my medical because you can get it OTC.

You are absolutely correct that is must be prescribed for an HSA. (Personally, I think this is one of the more unfortunate things that happened with the ACA. So I have to see my doctor to get a prescription for OTC Flonase.)