Tax season HSA checklist: 10 simple steps to maximize your savings

Tax season can sometimes feel overwhelming, but your Health Savings Account (HSA) can make things easier—and save you money. Whether you’re new to HSAs or just need a refresher, this checklist will guide you through everything you need to do to maximize your tax savings and prepare for the year ahead.

#1 Review HSA contribution limits.

Every year, the IRS sets limits on how much you can contribute to your HSA. These limits depend on your health insurance plan (individual or family coverage) and your age. If you’re 55 or older, you can contribute an extra $1,000 through catch-up contributions.

Log into your online account to check how much you’ve already contributed, then compare that to the limit to see if you have room to add more funds.

#2 Confirm employer contributions.

Many employers sweeten the deal by contributing to your HSA, but don’t forget—those contributions count toward your annual limit. For example, if your employer added $1,000 to your HSA, you’ll need to subtract that amount from the limit to calculate how much more you can personally contribute.

Your HealthEquity online account will show you a breakdown of employer contributions versus contributions you make on your own.

#3 Lower your tax bill¹ with a one-time HSA contribution.

Here’s a tip that could save you money: You can still contribute to your HSA for the previous tax year until the tax-filing deadline (usually April 15). If you haven’t hit the contribution limit yet, this is your chance to lower your taxable income and save big.

For example, if you’re in a 20% tax bracket, every $1,000 you contribute could save you $200 in taxes.² That’s a significant benefit for simply moving money into your HSA.

#4 Gather your HSA tax forms.

Tax filing requires paperwork, and your HSA is no exception. There are key forms to watch for:

• Form 1099-SA: This shows any withdrawals (distributions) you made from your HSA. If you didn’t take any money out, you won’t receive this form.

• Form 5498-SA: This summarizes how much you contributed during the year. You’ll typically receive it after the tax-filing deadline, but don’t worry—it’s for your records and doesn’t need to be filed with your taxes.

Make sure you have these forms on hand when completing your tax return. You can learn more about HSA tax forms by visiting our HSA Tax Center.

#5 Track qualified medical expenses.

Your HSA funds must be used for qualified medical expenses to avoid penalties. These include costs like doctor visits, prescriptions, and even some over-the-counter items. Plus, your HSA covers eligible dental and vision expenses too.

Looking for ways to spend? Add your card and shop eligible items at Amazon.³

To stay organized, keep all receipts for any HSA distributions. The IRS may ask for proof if you’re ever audited, and having your documentation ready can save you time and stress. Consider using the HealthEquity mobile app to snap a picture and upload receipts.

#6 Update your beneficiary information.

Your HSA isn’t just for you—it can also help your loved ones if something happens to you. Make sure your beneficiary information is up to date, especially if you’ve recently experienced a life change like getting married, divorced, or having children.

You can easily update your beneficiary information in your HealthEquity online account.

#7 Plan for future contributions.

Once tax season is behind you, take a moment to plan for the year ahead. Setting up automatic payroll deductions is one of the easiest ways to make steady contributions to your HSA. You can decide how much to contribute each paycheck, helping you spread out the savings over the year.

Not sure how much to contribute? Check out this article: How much should I contribute to my Health Savings Account?

#8 Double check state tax rules.

Although HSAs are federally tax-free, a few states have different rules. Some states may tax contributions or the interest and investment earnings in your account. If you live in one of these states, it’s worth consulting a tax advisor to understand your local rules.

#9 Evaluate your HSA investment⁴ strategy.

Did you know you can invest your HSA funds? Once your balance reaches a certain threshold, you can invest in mutual funds on the HealthEquity HSA Investment Desktop. HealthEquity also offers access to a Schwab Health Savings Brokerage Account,⁵ which lets you choose a wider menu of investment options.

Check out this article: Why you should consider investing your HSA.

If you’re already investing, tax season is a great time to review your portfolio. Does it align with your goals? Are you comfortable with the level of risk?

Small adjustments can help your HSA better serve your health needs and long-term financial wellbeing.

#10 File your taxes correctly.

When it’s time to file, you’ll need to report your HSA activity. Use IRS Form 8889 to document your contributions and distributions. If you’re using tax software, it will guide you through this step.

Double-check that your contributions match your records and ensure any distributions were for qualified medical expenses. Accuracy here can help you avoid any future issues.

Make the most of your Health Savings Account.

Your HSA is more than just a savings account—it’s a powerful tool for lowering taxes, preparing for medical expenses, and even investing for the future. By following this checklist, you’ll ensure you’re making the most of your account while reducing the stress of tax season. Remember, each step you take is a step toward financial security.

Take it one at a time, and don’t hesitate to reach out to a professional if you have questions.

You’ve got this!