HSA employers account or use own HSA account (Fidelity)

[wvu doc]

My employer was recently bought out and I now work for a corporation. I was a 1099 and had an s-corp for myself that I finally had all figured out. In the process of being a new W2 employee, they outsourced the human resources. I have selected a high deductible health insurance with HSA. The company told me I can use my own HSA, but they won't deduct from check pre-tax. Can I still have this written off my taxes at end of year?

Thanks!

[IMinMS]

Yes you can still deduct your HSA contributions even if they don’t deduct it pre-tax. One element of employer sponsored HSA plans that can be a pain is often times they will require you keep a token amount in cash (~$1000 is the requirement in mine) so there’s a bit of a cash drag that happens that wouldn’t be the case in an independent HSA.

[tylerjw12]

Yes you can do it this way. I think others have mentioned here that fidelity HSA is free and has good investment options, which are (IMO) the two most critical aspects of picking a tpa. Just a little more work on your end.

Does your company make any contributions to the HSA? This is common, and you may lose out on this free money if you don't use their preferred vendor.

[GasFIRE]

Yes, when you file your tax return. While not usually a problem for most doctors, if earnings are below the SS income limit you’ll pay the SS tax on the HSA contribution. However, since the MC tax applies to all wages, you’ll have to pay this if the HSA isn’t withheld by your employer.

[wvu doc]

Yes you can do it this way. I think others have mentioned here that fidelity HSA is free and has good investment options, which are (IMO) the two most critical aspects of picking a tpa. Just a little more work on your end.

Does your company make any contributions to the HSA? This is common, and you may lose out on this free money if you don't use their preferred vendor.

Unfortunately, no employer match for 401k or HSA.

[wvu doc]

Yes, when you file your tax return. While not usually a problem for most doctors, if earnings are below the SS income limit you’ll pay the SS tax on the HSA contribution. However, since the MC tax applies to all wages, you’ll have to pay this if the HSA isn’t withheld by your employer.

Just making sure I understand what you are saying. If I use company HSA and deduct it from check pretax, I could save some money on Medicare tax? If I just used my own HSA, I can still write off the income tax from it, but stuck with the Medicare tax on the amount?

Thanks!

[The White Coat Investor]

I'd probably use theirs to get the payroll tax savings and then do an annual rollover to Lively or Fidelity.

[wvu doc]

I'd probably use theirs to get the payroll tax savings and then do an annual rollover to Lively or Fidelity.

Great idea. Thank you!

[Hank]

I'd probably use theirs to get the payroll tax savings and then do an annual rollover to Lively or Fidelity.

Realistically, I’d go with Fidelity rather than Lively. I’m not aware of any fund performance, cost, or ease of use advantage of Lively over Fidelity. It’s far more likely that a forum member already has an IRA, 401(k), or other account at Fido than at Lively and one of these companies seems more likely to be around 20 years from now than the other. (Not that there should be any loss of investor funds, but why incur the extra headache of a company getting bought out?)

[Hank]

I suppose a sufficient number of HSA savers should go with Lively just to keep Fidelity honest and zero cost. This might be a typical prisoner’s dilemma, but I’ll let someone else volunteer to go with the smaller, lesser known entity.

[plowt-kirn]

I suppose a sufficient number of HSA savers should go with Lively just to keep Fidelity honest and zero cost.

Unfortunately Lively just took a major downturn. They use TD Ameritrade for their investment platform. With the TDA/Schwab merger, they are introducing fees and account minimums into their HSA product.

You now have to keep $3,000 in cash OR there's a $24/year annual fee.