How to track your HSA expenses in a spreadsheet
When people get their first Health Savings Account (HSA) card, they tend to treat it like a credit card.
They pick it up at the doctor’s office or pharmacy, use it to pay their bill and never think about it.
Unfortunately, this way of thinking can quickly get into trouble.
Although HSA cards work in a similar way to traditional credit cards, they have limitations that require a more careful approach.
If the IRS comes knocking about a purchase you made with your HSA card, you’ll need to be able to prove that it was a reimbursable medical expense.
This means you need to keep, store and track your receipts.
Why you should track HSA contributions and expenses
Your Health Savings Account (HSA) is a powerful financial instrument. It is a tax-advantaged savings account that allows you to save money before taxes for most medical expenses.
This money grows tax-free as it remains in your account, making it a solid investment vehicle and way to fund your medical expenses.
The IRS has strict rules about what you can use an HSA for. Monthly insurance premiums, elective procedures and homeopathic medicines are generally excluded. Prescription medications, lab work, and out-of-pocket expenses for doctor’s visits are permitted.
If you use your HSA card for a nonqualified medical expense, you will have to pay income tax on that amount and pay a 20% penalty.
Some people use their HSA card to pay medical expenses directly to the provider. When they receive a medical bill, they pay it with their HSA.
Others pay medical costs with their bank account, debit or credit card and then reimburse themselves for the costs from their HSA. If you prefer the latter method, remember to monitor your HSA spending closely.
Track your HSA contributions
First, set up automatic transfers from your bank account to your HSA. This will prevent you from saving too much in your HSA.
The HSA yearbook Contribution limits for 2024 are:
- $4,150 for individuals with self-only insurance
- $8,300 for family coverage
Additionally, those age 55 and older can make an additional $1,000 catch-up contribution.
Some HSA providers automatically track contributions for you and indicate when you’re nearing the annual maximum, but others don’t.
If you contribute too much to your HSA and don’t realize it until you file your taxes, you’ll pay a 6% excise tax on the additional contributions.
You can use the following tables to track your HSA contributions.
How to track your HSA spending
Tracking your HSA expenses can be tedious because these funds are kept separate from your regular checking or savings account. It’s easy to forget about your HSA until you need to use it for medical expenses.
However, it’s important to track HSA spending just as you would track your credit card balance. If you plan to use your HSA for upcoming surgery costs and forget that your balance has gone down, you’ll be in trouble with the bill.
Your HSA provider may have its own tracking system and simple customer interface.
Some even allow users to upload receipts directly to prove the eligibility of certain expenses.
However, for more control, consider using a spreadsheet to record your HSA purchase date, cost, provider, and whether you used HSA funds or another payment method.
Also, make a note of whether you are still waiting for your payment to be refunded.
Automatically track your HSA in a spreadsheet with Tiller
Tiller automatically tracks all of your finances in Google Sheets and Excel. This includes your HSA account information.
Created by a member of the Tiller Community a free HSA expense tracking template powered by Tiller to help you track and manage medical expenses that qualify for HSA reimbursement.
The template automatically retrieves all transactions marked as “HSA Tracking” from your master transaction data, allowing you to maintain a running record of your eligible expenses. The purpose of this workflow is to:
- Keep accurate records of your annual and cumulative medical expenses that qualify for HSA reimbursement.
- Have a running balance on hand equal to the amount you can legally withdraw from your HSA when needed, especially in early retirement.
- Build an additional emergency fund reserve while allowing your invested HSA dollars to continue to grow.
You can find the template here Tiller Community.
Use a simple, free Google Spreadsheet
A Redditor created a great HSA comparison table. Read about it Here.
Open the spreadsheet in Google Sheets Here.
Every HSA provider is different
If your HSA is not through your employer, you have the option to change HSA providers at any time. If your HSA is part of a company benefits package, you must stay with that provider. Then it comes in handy to create your own table.
Set up a specific time each month to go through your HSA.
View your medical records, check your HSA account and update the spreadsheet. Look ahead to see if there are any upcoming medical costs that you want to pay for with your HSA and make sure you have the funds to cover the costs.
