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Purdue University HR Interactive HSA Guide

NOTE: Purdue University is providing you with this tool for informational purposes to help guide you through the Health Savings Account (HSA) eligibility rules. This information does not constitute tax or legal advice. If you have specific questions about the implications of these plans for you, you are encouraged to seek professional tax or legal counsel.

Eligibility Rules

Interactive HSA Tool

Specific Situations

Children of Divorced Parents

  • For purposes of the HSA only, the child is considered the dependent of both parents. Therefore, either parent's HSA money may be used on the child.
  • If the child is not listed as a tax dependent and HSA money is used for their expenses, the money will be taxed.
  • If the employee is covering the child(ren) under his or her health insurance even if they are not a tax dependent, s/he can contribute up to the family maximum for HSA but may not spend the HSA money on the child(ren).

Adult Child

  • Adult child (tax-dependent - up to age 19 or 24 if full time student): the child’s out-of-pocket medical expenses can be paid with the primary account holder’s HSA. In other words, the parent can use their own HSA to pay for the child’s medical expenses.
  • Adult child (not tax-dependent, on parent's HDHP through age 26): the child’s out-of-pocket medical expenses cannot be paid with the primary account holder’s HSA. If this is the case, contact your tax advisor for further assistance.

Medicare Disclaimer

  • If an employee becomes disabled and enrolls in Medicare, s/he can no longer contribute to an HSA or have anyone else contribute on his or her behalf (such as Purdue) as of the first of the month in which the employee enrolled. The current HSA funds may be used to pay Medicare Part A and/or Part B premiums, as it is considered a qualified medical expense. If the disabled employee does not receive Medicare, s/he can stay on the HDHP just without the Purdue HSA contributions.
  • When the employee reaches age 65, s/he becomes eligible for Medicare. If s/he enrolls in Medicare, s/he can no longer contribute to an HSA or have anyone else contribute to an HSA on his or her behalf (such as Purdue). If the employee does not enroll in Medicare, the employee may continue with his or her HSA.

Terminating Employment with Purdue

The HSA funds in an employee's account will remain in his or her name, but the account will be switched to a retail account and the employee becomes responsible for the monthly account maintenance fees for the HSA.

COBRA

If the employee has an HSA account it remains his or her account for the employee to pay qualified health care expenses. The employee will no longer receive contributions from Purdue and the employee can no longer make contributions. Employees on COBRA may choose from any of Purdue's health plans, including the HDHPs, but will not receive an HSA or contributions through Purdue.

Resources

  • For more information on HSA's, visit the Purdue Benefits homepage.
  • To manage your Health Savings Account, view eligible expenses, and access additional ressources, visit PayFlex .
  • To change your contribution to your HSA, visit Benefitfocus.
  • For the IRS publication on HSA's and Other Tax-Favored Health Plans, click here.
  • For the IRS publication on Divorced or Separated Individuals, click here.