Using HSA Funds to Purchase Breastfeeding Supplies
Did you know that there’s a way to save money on breastfeeding supplies without clipping coupons or waiting for sales? If you’re eligible to set up a Health Savings Account (HSA), you can contribute pre-tax dollars to your account and use those funds for approved medical expenses, including items to help you breastfeed your baby. Not only will you be able to make purchases with tax-free money, your contributions to your HSA are tax-deductible, which lowers your taxable income for the calendar year.
Here’s what you need to know about HSAs:
Who is eligible?
You need to have a high-deductible health insurance plan to open an HSA. The IRS defines the deductible amount for eligibility for HSA, and it can change from year to year. In 2021, you’ll qualify if your deductible is at least $1,400 for an individual health insurance plan and $2,800 for a family health insurance plan.
Many people receive health insurance through their employers, while others enroll directly through the federal Health Insurance Marketplace. People with either type of health insurance may be eligible to open an HSA, as long as the plan has a high enough deductible.
How much can be contributed?
If you’re eligible to contribute to an HSA, you can choose the amount that you want to contribute based on your needs. For up to date limits on contributions, check out https://www.irs.gov/publications/p969. Funds can be used for breastfeeding supplies as well as other medical expenses, including doctor and dentist visits, appointments with a psychologist or psychiatrist, glasses and contact lenses, lab fees, prescription medication, and more. In most cases, funds also roll over from year to year, as long as you still have a high-deductible health insurance plan, so you don’t have to spend it all this year.
If you’re married, you can’t open a joint HSA with your partner; each of you needs to have your own HSA. But your partner can use their HSA to make approved medical purchases for you, including breastfeeding supplies.
Which expenses are covered?
Many breastfeeding supplies should be covered by your HSA. You can use HSA funds for breastfeeding supplies that are one-time purchases – things like a pumping bra or breastmilk collector / silicone breast pump – as well as items which will need to be purchased on an ongoing basis, such as disposable nursing pads and breastmilk storage bags.
You should also be able to use your HSA funds toward a breast pump. Breast pumps should be covered by your health insurance, but many women find it convenient to have a second breast pump to leave at work. Because you’ll be using pre-tax dollars, you’ll save money, so it may be worth the cost to add convenience to your life.
Plans can vary quite a bit, so be sure to check with your individual plan to see what’s allowed. If you use funds for unapproved items, you’ll have to pay income tax on those purchases, plus a penalty.
How can I set up an HSA?
Your health insurance company may offer an HSA for members, which may make it easy for you to begin the process. If this isn’t a possibility, find out if your bank or financial institution offers HSAs for account holders. You can also search online for HSA providers.
Each HSA provider may have a different application process, and some may have fees associated with their accounts. Different HSA providers may have different ways for account holders to deposit money. You can find out specifics from individual providers.
How do I shop with my HSA?
It depends on your plan, but when you’re ready to make a purchase, you may use your HSA account’s debit card to pay directly for purchases, or you may reimburse yourself, using your HSA account’s debit card at an ATM, for any purchases that you’ve made another way. Be sure to hold onto receipts which prove that your HSA funds have gone toward breastfeeding supplies or other qualifying expenses.
It’s easy to shop for HSA eligible items at many of your favorite retailer. Amazon, Target, and Walmart all have FSA/HSA shops online, and you may even be able to link your HSA account for convenience.
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