Though FSA and HSA are often used interchangeably, they're two very different health plans, and they're not always compatible. We explain whether or not you can have both at the same time. Read on to learn more!
What are FSA and HSA?
FSA stands for Flexible Spending Account, while HSA stands for Health Savings Account. Both are provided by employers and involve using pre-tax dollars on medical expenses.
What's the Difference Between FSA and HSA?
There are several, but the most important is that HSA funds left in your account will stay there when the year is up, whereas FSA requires you to spend all of the money. Some FSA plans will roll $500 over to the next year or provide a grace period, but any extra funds are forfeited. To learn more about the nuances between the two, check out What's the Difference Between FSA and HSA?
So...Can I Have FSA and HSA at the Same Time?
It's uncommon, but yes, it's possible. Some employers offer what's called either a limited-purpose or post-deductible FSA, or colloquially "HSA-compatible FSA." Limited-purpose is the more common of the two, and lets you spend the money on vision or dental expenses only. You can also use the money on your spouse or children age 26 and under.
Meanwhile, a post-deductible FSA will only let you use your funds once you've hit your minimum HSA deductible.
Despite this, having both FSA and HSA simultaneously is uncommon. Here are the 2 most common disqualifiers:
- Having a general purpose (A.K.A. traditional) FSA plan. If you have one, you cannot also sign up for HSA.
- Your spouse has a general purpose FSA plan. Regardless of whether you are listed as a dependent or not, you cannot sign up for an HSA while your spouse has a general FSA.
One other thing to note is that you keep your HSA account after you change jobs. The same is not true for FSA accounts. If you start a new job that only offers a general purpose FSA, talk it over with your benefits provider to figure out the best solution.
Good news, though! You can use your FSA or HSA money to buy prescription eyewear from SportRx. Learn more about how to do so by checking out Can I Use My FSA/HSA to Buy Prescription Glasses?
Disclaimer: This content is provided solely for informational purposes. It is not intended as and does not constitute legal advice. The information contained herein should not be relied upon or used as a substitute for consultation with legal, accounting, tax and/or other professional advisers.