How long to save hsa receipts

Be sure you understand what medical expenses are HSA qualified and be able to produce receipts for those items or services that you purchase with your HSA. You may face a 20 percent penalty on any distribution that you cannot prove was for a qualified medical expense. Also, keep receipts for all other items purchased with your HSA, for example, vision and dental services. Want to know the best part? Oh, and your tax professional will seriously love you for doing this when audit time comes.

Your HSA provider will send you a statement either digitally or through the mail outlining your contributions, employer contributions made on your behalf, payments made to providers from your HSA, interest earned and any fees charged to your account. File these statements as you would any other bank statement, as they may be required in the event of an audit.

The only reason you actually need documentation of your receipt or documentation of your qualified HSA-reimbursable medical expense is if you need to prove it to the IRS, which would only happen if the IRS audited your tax return. See, everything is self-reported on Form as a part of your IRS tax package. I sure hope so. Nothing to find here Johnny.

The IRS is likely only looking at things on an annual basis. That person hit their out-of-pocket max this year on their health plan.

While there are no hard and fast rules for all documents, following are some commonly suggested guidelines for how long you need to keep even the digital copies:. Tax Returns: Seven years is the general rule of thumb for keeping tax returns and the related documentation like W-2s, receipts for charitable donations and other paperwork to support income and deductions claimed. The basis for this is that the IRS has three years to audit your return for any reason from the date of filing.

Life Insurance Policies: Keep the original policy for the life of the policy plus 3 years. Receipts for Home Improvements: Any remodel projects or improvements that could enhance the value of your home can be added to your basis and possibly reduce any taxable gain when you sell your home, so keep these as long as you own the home for maximum tax savings.

If the statements support tax deductions, they should be maintained for seven years along with your tax files. Utility Bills: If utility bills support deductions made on your tax return, they should be kept for seven years from the end of the year in which they were claimed.

Once you receive your W-2 and verify that it matches your pay stubs, you can safely shred your old stubs. Warranty Documents: Dispose of these when the warranty expires or you get rid of the item under warranty.