The 2027 HDHP/HSA Guide for Feds: Lower Net Costs, Tax Savings, & Investing.
Updated: 18 hours ago
Open Season runs from November 9th through December 14th. And for some, it feels like open season on your wallet, with insurance companies taking aim. Some plans are imposing steep premium increases, raising out-of-pocket maximums, and increasing deductibles. Open Season is your opportunity to reevaluate your health insurance coverage.
For the fifth year in a row, I'm making the case for a High-Deductible Health Plan (HDHP) paired with a Health Savings Account (HSA). I try to avoid writing about the same topic year after year, but this one is worth repeating. I've had GEHA HDHP coverage since 2020 and have no plans to switch anytime soon.
I'll stop the annual HSA praise-a-thon when it stops making financial sense. Until then...here we go.
Warning: This isn’t the 10,000-foot overview. It's a small book, I know. We’re going to get into the weeds and address the specific questions I hear time and again from coworkers and clients. This decision could be worth tens of thousands of dollars, so I think it's worth the time.
Disclaimer: In this article, I’m focusing primarily on the numbers. The decision you make regarding your family’s insurance plan should encompass a lot more than just the numbers. Life is not a spreadsheet. Even decisions that appear to be clear winners on paper, may not end up being the right decision.
Please compare plans using this free OPM tool and understand what the plans do/do not offer. If you have certain prescriptions, a planned surgery, or any special circumstance, call the plan provider and ask them about your responsibility versus their coverage.
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What if your spouse has their own non-HDHP insurance through their employer?Can someone else fund your HSA? Can you fund someone else's?
Why consider a High-Deductible Health Plan now?
If there was ever a time to reevaluate your health insurance plan, it’s now. OPM has released the 2027 Federal Employee Health Benefit (FEHB) plan premium rates. The average enrollee premium increase will be 10.9%, with some plans seeing significantly larger increases.
The Foreign Service Benefit Plan (FSBP) Self Plus One option (plan 403) is increasing from $257.96 to $429.35 per biweekly pay period. That's a staggering 66.44% increase, costing employees an additional $4,456.14 per year. The FSBP Self and Family option (plan 402) is “only” increasing 54.13%, from $248.27 to $382.65 per pay period, resulting in an additional $3,493.88 annually.
From 2023 through 2027, the average annual increase in FEHB enrollee premiums will have been 10.6%, compared with an average annual federal civilian pay adjustment of just 2.6%, assuming the proposed 2027 pay freeze takes effect.
Over those five years, average FEHB enrollee premiums will have increased at more than four times the average annual rate of federal pay adjustments.
Compounded over the five-year period, that's approximately a 65.5% increase in FEHB premiums, compared with just 13.4% in federal pay adjustments.
According to Matthew Kiley, OPM’s Associate Director for Healthcare & Insurance, “For the second year in a row, OPM has been able to reduce the average rate of premium increases for federal employees and annuitants.”
I don’t know about you, but watching average premium increases drop from 13.5% to 12.3% and then to 10.9% doesn’t exactly feel like a big win. That’s still a cumulative increase of 41.35% over just three years.
To put that into perspective, if you were paying $200 per pay period at the end of 2024, you'd now be paying approximately $282.71, assuming your plan experienced those same annual increases. That's an additional $2,150.46 per year in health insurance premiums, assuming 26 pay periods.
Bragging about slowing the rate of premium increases is a bit like saying, “We’re going to keep punching you in the face, but we’re going to slow down the punches.”
Not exactly the public relations strategy I would have chosen, but to each their own.
Here’s a quick comparison of some plans that I commonly hear my coworkers talking about.
Note: 0% premium increase for the Government Employees Health Association (GEHA) High-Deductible Health Plans (341, 342, & 343).
IMPORTANT: For those who were using the Mail Handlers Benefit Plan (MHBP) HDHP for their HSA, please see the end of this article for important information regarding specific MHBP plan termination.
The 5 Basic Parts of the HDHP/HSA Combo
I was recently up in New York City working the annual convention for federal agents to complain...I mean, the United Nations General Assembly, and had a fellow agent ask me to explain the Health Savings Account (HSA) like he was a middle school student. When I started to explain all the amazing features about the HSA, I quickly realized that the HSA itself might not be the simplest thing to understand. Is it health insurance? Is it a savings account? How do you make contributions? What about use or lose?
So, I’m going to break this down piece-by-piece so that you can go into Open Enrollment season fully armed with the information that you need to make an informed decision. The HDHP/HSA isn’t for everyone, but for many, it’s a no-brainer and a financial game changer.
Part 1 – Insurance Coverage
IMPORTANT: In order to contribute to an HSA, you must be covered by a High-Deductible Health Plan (HDHP).
I personally have used the GEHA HDHP option (FEHB Plan 341 for self-only) since 2020 and have never had any issues. I currently pay $81.62 bi-weekly from my paycheck (screenshot below). GEHA is the health insurance company. Just like Blue Cross Blue Shield, Foreign Service Benefit Plan, Compass Rose, etc. When my doctor asks who I have for insurance, I say “GEHA”. My insurance card says GEHA, CVS Caremark for the pharmacy provider, and United Healthcare Choice Plus Network. United Healthcare Choice Plus is the provider network that GEHA uses, which means I have access to participating doctors, hospitals, and specialists through the United Healthcare network.
You can see on my Earnings & Leave Statement that it says, “Health Benefits - Pretax.” This is not a unique feature of an HDHP or my particular insurance plan. For active federal employees participating in FEHB premium conversion, the biweekly amount you pay for health insurance coverage (your premium) is deducted from your paycheck before income and payroll taxes are calculated.
What does this mean?
Let's keep it simple. Assume your gross pay for a pay period is $6,000, and your health insurance premium is $100. When your payroll processor calculates your federal income tax, state income tax, and payroll taxes, that $100 premium is excluded from your taxable wages. In other words, your taxes are calculated using $5,900 rather than $6,000.
Why? Because your health insurance premium is paid with pre-tax dollars.
Now, assume you're in the 22% federal income tax bracket, your marginal state income tax rate is 5%, and your share of payroll taxes is 7.65%. That's a combined marginal tax rate of 34.65%.
That $100 pre-tax insurance premium saves you:
$22.00 in federal income tax
$5.00 in state income tax
$7.65 in payroll taxes
That's a total tax savings of $34.65 on a $100 insurance premium.
Here's another way to look at it:
Taxes without a pre-tax premium deduction:
$6,000 × 34.65% = $2,079.00
Taxes with a $100 pre-tax premium deduction:
$5,900 × 34.65% = $2,044.35
Total tax savings: $34.65.
This should start to make your gears turn. Think about how valuable pre-tax deductions like traditional TSP and an HSA can be, especially for high earners.
Part 2 – Get a Portion of Your Premium Returned to You
In the months that I receive two paychecks, I pay $163.24 ($81.62 × 2) in health insurance premiums. That's what comes out of my paycheck for health insurance coverage.
But here's where things get interesting.
Each month, GEHA gives me $83.33.
This is what's known as a “premium pass-through.” Essentially, GEHA takes a portion of the premiums paid for your health insurance coverage and deposits that money into an HSA on your behalf.
For Self Only coverage, that's $1,000 per year. For Self Plus One or Self and Family coverage, it's $2,000 per year.
Part 3 – Health Savings Account
So, we know that GEHA is depositing money into my HSA each month. But what exactly is an HSA?
Think of an HSA as a hybrid between a Traditional IRA and a Roth IRA. It's another type of tax-advantaged savings and investment account, but with some unique benefits.
That $83.33 lands in my HSA each month, where I can invest it in mutual funds, exchange-traded funds (ETFs), or simply leave it in cash. Full disclosure: My entire HSA is invested in the Vanguard Total Stock Market Index Fund (VTSAX). This is not investment advice.
Here's where things get interesting: That $83.33, along with any investment growth, can be withdrawn completely tax-free when used for qualified medical expenses.
I can:
(1) Use the HSA funds to pay for qualified medical expenses today (and there are a LOT of things that qualify)
(2) Use the HSA funds to reimburse myself at any time in the future for medical expenses that were paid out-of-pocket after my HSA was first established.
(3) Leave the HSA funds invested, let them compound for decades, and use them for medical expenses later in life. Note: There is NO “use or lose” rule with an HSA, even if you switch to a health insurance plan that isn't an HDHP. Just because you're no longer eligible to contribute to an HSA upon terminating HDHP coverage doesn't mean you can't maintain the HSA account, keep the money invested, and use it for qualified medical expenses in the future.
And here's an added bonus: Once I turn 65, I can use my HSA money for whatever I want. If I withdraw money from the HSA for non-medical expenses, the account essentially functions like a Traditional IRA. I'll owe ordinary income tax on the withdrawal, but the 20% penalty for non-medical withdrawals no longer applies. If I use the money for qualified medical expenses, however, the withdrawal remains completely tax-free for federal income tax purposes, regardless of my age.
Part 4 – Additional HSA Contributions
What if we want to save and invest more than the premium pass-through amount? Luckily, we can!
The annual HSA contribution limit for 2027 is $4,500 for those with self-only coverage the entire year and $9,000 for those with self plus one or self and family coverage the entire year. The premium pass-through counts towards that limit.
This means that I still have $3,500 that I can invest in 2027.
$4,500 annual limit for self-only
-$1,000 premium pass-through
= $3,500 additional contribution
I can contribute the remaining allowable contribution of $3,500 directly from my Bank of America checking account, or I can contribute this amount via payroll deduction.
Which option do you think is better? That’s right, via pre-tax payroll deduction. Why? You get to save an additional 7.65% in payroll tax. That’s $267.75 less payroll tax I have to pay.
What about for self plus one or self and family coverage? Subtract the $2,000 GEHA premium pass-through from the $9,000 annual contribution limit and you're left with $7,000 in additional contributions that you can make. By contributing that amount through pre-tax payroll deductions, you could save an additional $535.50 in payroll taxes (7.65%).
That's $535.50 you get to keep by simply choosing how you contribute to your HSA.
I say “could save” because once your earnings exceed the annual Social Security wage base ($192,300 for 2027), the 6.2% Social Security tax portion of the 7.65% payroll tax no longer applies. The 1.45% Medicare tax generally continues regardless of income, and an additional 0.9% Medicare tax can apply at higher earnings levels.
Your HSA contribution will show up on your Earnings & Leave Statement like any other deduction.
Contribution Deadline
You can make HSA contributions for the previous tax year up until the federal income tax filing deadline, which is generally April 15 of the following year (excluding extensions). For example, you could make contributions for the 2026 tax year until April 15, 2027, even after 2026 has ended.
Catch-Up Contributions
Individuals can also make an additional $1,000 catch-up contribution beginning in the calendar year they turn 55. If both spouses are age 55 or older and covered under a family HDHP, each spouse can make a $1,000 catch-up contribution, but each must contribute to their own individually-owned HSA. Unlike a joint bank account, an HSA is individually owned, so spouses cannot combine their catch-up contributions into a single HSA. Note: You do not actually have to be 55 to start making catch-up contributions, you just have to be age 55 on/by 12/31/27.
HSA Bank & HSA Invest
Your personal contributions (not the premium pass-through) can go to any HSA custodian, or be rolled over from HSA Bank to a different custodian (Fidelity, Lively, etc.). However, with the FEHB GEHA plan, the $1,000/$2,000 PPT will always be sent to HSA Bank first. You can then choose to keep the money in that HSA Bank account as cash, invest it via the HSA Invest brokerage platform, or roll it out to an outside HSA custodian.
I personally have only used HSA Bank and their brokerage account platform HSA Invest. Why? I prefer to keep my financial life as simple as possible and I haven’t been charged any account fees (just the regular expense ratio fee associated with the index fund I invest in). I have one login and all of my HSA dollars under one roof. This works for me. No need to mess around with electronic transfers or a rollover.
As of now, there are no fees to use HSA Invest for GEHA members who choose their own investments (the “Choice” option). WARNING: I do not know if this will remain the case.
There are three options with HSA Invest.
(1) Choice: This option is for those who are comfortable picking their own investments. The HSA invest public facing website lists this option as having a 0.10% fee (plus any applicable fund charges/expense ratios). However, it appears that individuals enrolled in a GEHA HDHP plan under FEHB pay a 0.00% fee. When I log into my personal account and go to "Manage Investments," I see that my fee is 0.00% (see screenshot below). The fee page states that the annual fee for the Choice option is waived through June 30, 2026. I'm unsure whether they've extended this waiver. When I go to my activity page, I can see that I've paid $0 in fees (other than the expense ratio of the fund I invest in).
(2) Select: This option is for those who want guidance and a recommended list of funds to invest in. The cost is 0.25% annually (plus any applicable fund charges/expense ratios).
(3) Managed: This option is for those who want their investments managed by an investment advisory firm. The cost is 0.35% annually (plus any applicable fund charges/expense ratios).
According to the HSA Invest website, if you have an account with a cash balance of $7,500 or more, the fees will be waived for that quarter. This is what I see when I log in and click "fees".
Let’s talk fees in terms of dollars. The fee listed is the percentage that will be charged for each dollar in your account. So, if you have $10,000 in your HSA and pick the “Select” option, which charges 0.25%, you would pay $25 for the year ($10,000 x .0025), billed $6.25 quarterly.
I’ve been using HSA Invest since the initial launch and have had no issues. I transferred my money over from my Charles Schwab HSA to HSA Bank, enrolled in HSA Invest, selected the one mutual fund that I choose to invest in, and set up automatic investing for every contribution and PPT deposit. Having HSA Invest versus Charles Schwab results in one less log-in for me to keep track of, keeps my financial life simple, and has cost me $0 (as of today).
Part 5 – Let it Compound or Withdraw to Pay/Reimburse for Medical Expenses
Many people use their HSA as a pass-through account for current medical expenses. They use their HSA funds throughout the year to pay for expenses (copays, prescriptions, over-the-counter medications, etc.) as they arise. There’s nothing wrong with that approach. You’re still saving on payroll taxes (if contributing through payroll deductions). And remember, unlike an FSA, an HSA doesn’t have a “use-it-or-lose-it” provision, so any money remaining at the end of the year stays in your account and carries over to the next year.
I personally would recommend using it another way, if your financial and medical situation allows.
Here’s what I do.
I pay for all my medical expenses out of pocket. I’ve never taken money out of my HSA, and I don’t plan on making withdrawals anytime soon. Prescriptions, Tums, contact lenses, office visit copays, lab work, Tylenol, sleep aids, etc. If it’s an HSA-eligible expense, I pay for it out of pocket (click here for a great resource listing qualified medical expenses). I take a picture of the receipt, save it in a cloud folder, and record the expense in my HSA spreadsheet.
Why am I tracking all of this in a spreadsheet?
Because I can reimburse myself for those medical expenses whenever I want, provided they were incurred after my HSA was established and haven't already been reimbursed or deducted on my tax return. This is how an HSA can serve as an additional emergency fund...or even a splurge fund.
Money in your HSA + previously unreimbursed qualified medical expenses = money that you can access tax-free and penalty-free, up to the amount of those eligible expenses.
Let’s do an example.
Let’s hypothetically say I have $10,000 worth of VTSAX in my HSA. December rolls around, and I’m sick and tired of Virginia. I’m tired of my fellow government workers. I’m tired of the horrible drivers. I’m tired of the lack of quality pizza. I decide to take a trip up to Connecticut to see family and stuff my face with good pizza. But there’s been a government shutdown, and I’ve been living off my savings since October. I could use a little extra cash for a hotel and a few extra slices.
My HSA has $10,000 worth of VTSAX, and I have receipts totaling $5,000 for unreimbursed qualified medical expenses incurred over the past six years. I can withdraw up to $5,000 from my HSA tax-free and penalty-free as reimbursement for those prior medical expenses. It doesn’t matter that I’m going to spend the money on pizza and Dunkin’.
Now, if I withdrew more than $5,000 and didn’t have additional qualified medical expenses to justify the withdrawal, the excess would generally be subject to ordinary income tax and a 20% penalty (assuming I’m under age 65 and no other penalty exception applies).
That’s the difference. You can withdraw money from your HSA at any time to (1) reimburse yourself for prior qualified medical expenses paid out of pocket or (2) pay for current qualified medical expenses. You can even get an HSA debit card to make the process simple.
Important Note 1 – There is NO deadline for reimbursing yourself from an HSA. In the scenario above, I could have reimbursed myself for qualified medical expenses incurred one year ago or six years ago. What matters is that the expenses were incurred after the HSA was established and have not already been reimbursed or deducted on your tax return (more on double-dipping below).
Important Note 2 – This was just an example to illustrate how HSA reimbursements work. I don't recommend routinely using your HSA as an emergency or splurge fund. With the tax benefits built into the account, the goal should be to let your investments grow tax-free for as long as possible, assuming your financial situation allows. As Charlie Munger famously said, “The first rule of compounding is to never interrupt it unnecessarily.”
HSA Eligibility
In order to contribute to an HSA, you must meet ALL FOUR requirements, which can be found under 26 U.S. Code § 223 and on page 3 of IRS Publication 969 (2025).
1. You must be covered by a High-Deductible Health Plan (HDHP).
2. You cannot have other disqualifying health insurance coverage. Note: You CAN have vision, dental, accident, disability, long-term care, and various “other health coverage” options outlined on page 4 of IRS Publication 969.
3. You cannot be enrolled in Medicare.
4. You cannot be eligible to be claimed as a dependent on someone else’s tax return, regardless of whether they actually claim you. This is an important distinction. Section 223(b)(6) of the Internal Revenue Code (IRC) explicitly says, "Denial of deduction to dependents - No deduction shall be allowed under this section to any individual with respect to whom a deduction under section 151 is allowable to another taxpayer for a taxable year beginning in the calendar year in which such individual’s taxable year begins."
That's it!
What if you retire? What if you already retired? What if you move states? What if you're abducted by aliens? What if a solar eclipse occurs during a waxing gibbous moon phase? None of those things matter (for HSA purposes). If you meet the four criteria above, you can contribute to an HSA. I know many federal retirees who have crossed the finish line, aren’t working a post-retirement job, and still contribute to their HSA (earned income is not a requirement).
Reduced Contributions
Generally, you can only contribute to an HSA for the months you're eligible. To calculate your prorated annual contribution limit, multiply the number of months you're HSA-eligible by the annual contribution limit ($4,500 for self-only coverage or $9,000 for family coverage in 2027), then divide by 12.
For example, if you're HSA-eligible with family HDHP coverage for five months, your contribution limit would be $3,750.
Here's the math: $9,000 × 5 months ÷ 12 = $3,750.
Important: There's an exception to this general rule called the Last-Month Rule, which may allow you to contribute the full annual limit even if you weren't eligible for the entire year.
Last-Month Rule
If you are HSA eligible on the first day of the last month (December 1st for most taxpayers) you are technically considered HSA eligible for the entire year for purposes of calculating your allowable HSA contribution. This is less important for federal employees due to the fact that elections made during Open Season will not be effective by December 1st.
But, there's a small catch. You must remain HSA-eligible throughout the testing period. From IRS Publication 969, "The testing period begins with the last month of your tax year and ends on the last day of the 12th month following that month." For December 1, 2026, the testing period would end December 31, 2027.
If you lose HSA eligibility during that testing period, the additional contributions allowed under the last-month rule would become taxable income and would generally be subject to an additional 10% tax. There are exceptions for death and disability. There are multiple examples of this scenario on Page 6 of IRS Publication 969.
VA Disability & TRICARE
VA Disability
There’s some conflicting information out there because the rules have changed a few times. There used to be a 3-month testing period if you received VA care. Luckily, this no longer applies.
The Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 is the key. Section 4007(b) amended the Internal Revenue Code (IRC) to establish a specific exception for veterans receiving medical care related to service-connected disabilities.
Here's the actual language from the IRC.
So, how did the IRS interpret this change?
They basically said if you have a disability rating and receive care from the VA, that is going to be considered “service-connected” because it’s too “administratively complex and burdensome” for everyone to figure out what’s service-connected and what isn’t.
IRS Notice 2015-87 lays it out pretty clearly -
“As modified by the legislation, an individual actually receiving medical benefits from the VA is NOT DISALLOWED from making HSA contributions if the medical benefits consist solely of (1) disregarded coverage, (2) preventive care, or (3) hospital care or medical services under any law administered by the Secretary of Veterans Affairs for service-connected disability (within the meaning of § 101(16) of title 38, United States Code).”
“Distinguishing between services provided by the VA for service-connected disabilities and other types of medical care is administratively complex and burdensome for employers and HSA trustees or custodians. Moreover, as a practical matter, most care provided for veterans who have a disability rating will be such qualifying care. Consequently, as a rule of administrative simplification, for purposes of this rule, any hospital care or medical services received from the VA by a veteran who has a disability rating from the VA may be considered to be hospital care or medical services under a law administered by the Secretary of Veterans Affairs for service- connected disability.”
TRICARE
This is a different story because TRICARE does not fall under the Secretary of Veterans Affairs like VA Disability. Instead, TRICARE is under the Department of Defense. For HSA purposes, TRICARE is just another non-HDHP insurance plan, which means no HSA contributions are allowed.
The IRS addressed this in IRS Notice 2004-50:
OPM echoes the same on their HSA FAQ website:
Net Annual Cost Comparison
This one requires a visual. Nobody likes the sound of “high-deductible” ...it sounds expensive. Just like with any type of insurance, the deductible is the amount you pay out-of-pocket before plan benefits kick in.
Let’s look at four FEHB plans for 2027 and their in-network deductibles.
GEHA HDHP: $1,800 deductible (self-only) / $3,600 (self plus one & self and family)
Blue Cross Blue Shield Basic: $0 deductible (all plans)
Blue Cross Blue Shield Standard: $500 deductible (self-only) / $1,000 (self plus one & self and family)
Foreign Service Benefit Plan: $300 deductible (self-only) / $600 (self plus one & self and family)
Yikes! Look at the $1,800 deductible for the GEHA HDHP self-only plan versus the $0 deductible for BCBS Basic. If we only cared about the deductible, it appears that BCBS Basic would be the winner. But what about the net annual cost? In order to find out the net annual cost, we need to look at the bi-weekly premiums coming out of each paycheck, any premium amount returned, any possible tax benefits, and the bottom line cost if you had to pay the out-of-pocket deductible for each plan.
What if you want to use the HSA but don’t want to invest the $3,500 additional? Even if you reached the full $1,800 annual deductible, you’d still be spending less on a net basis than some other plans, just based on the bi-weekly premium savings and premium pass-through.
Disclaimer for net cost comparisons: This is for illustration purposes only and does not guarantee your actual costs; the official plan brochures govern coverage, benefits, and rates, and 2027 premiums are subject to change. Net costs show your annual premium plus either the full deductible or the annual maximum out-of-pocket amount (in-network, covered services only), which are two reference points rather than predictions. Costs between those points, such as copayments and coinsurance, are not shown and can vary widely. The HDHP premium pass-through is a contribution to a Health Savings Account (HSA), not a cash payment, and the tax savings depends on your individual situation. Review each plan’s official brochure and consult a benefits representative or tax professional before enrolling.
Big Picture Takeaways
Contributions are free from federal income tax.
Contributions are free from state income tax. Note: California and New Jersey generally don't conform to federal HSA tax treatment. Other states may have particular tax rules when it comes to the HSA.
Contributions are free from payroll taxes when made through eligible payroll deductions.
Investment growth is tax-free at the federal level (NJ and CA generally tax HSA investment earnings).
Distributions are tax-free when used to pay for, or reimburse yourself for qualified medical expenses. There is no time limit for reimbursement. You can let the money grow tax-free and reimburse yourself decades from now.
Distributions are penalty-free at any age when used for qualified unreimbursed medical expenses.
Distributions are penalty-free for any purpose (not just medical) upon reaching age 65. If you reach age 65 and distribute money from your HSA for non-medical expenses, ordinary income tax will apply, but there's no additional 20% penalty (similar to a traditional IRA).
There are no Required Minimum Distributions (RMDs).
An HSA is not tied to your employer. If you leave the company/agency, you still keep your HSA.
There are no income limits that restrict your ability to contribute to an HSA.
There is no earned income requirement to contribute to an HSA.
There is no other account in existence that offers quite the same combination of tax benefits.
Who do I think an HSA is best for?
Those who are generally healthy, have a well-funded emergency fund, and want to save and invest more money in a tax-advantaged account.
If your health insurance plan has a $6,000 annual out-of-pocket maximum (whether it's an HDHP or not), I would recommend having at least $6,000 set aside in a safe, liquid cash reserve to cover those potential expenses.
What happens when you stop being covered by an HDHP?
The HSA is yours to keep and use as you see fit. Just because you don’t have HDHP coverage doesn’t mean your HSA goes away. The dollars in the account are still yours and can still be used for the same purposes as mentioned above (qualified medical expenses, reimbursement, or any expense upon reaching age 65).
What if your spouse has their own non-HDHP insurance through their employer?
You're still good to go! As long as (1) YOU are covered by an HSA-eligible HDHP and (2) your spouse's separate non-HDHP DOES NOT cover you, you can still contribute to an HSA.
However, whether you qualify for the individual or family HSA contribution limit depends on your HDHP enrollment. If your HDHP covers only you, you're limited to the self-only contribution limit. If your HDHP covers you and at least one other eligible family member, you can contribute up to the family limit, even if your spouse has separate non-HDHP coverage. This one can get confusing, so here's the exact language from the IRS.
Can someone else fund your HSA? Can you fund someone else's?
Yes! Anyone can contribute to someone else's HSA. Your friend, neighbor, boss, sister...anyone!
If you already contribute to your HSA through pre-tax payroll deductions, but your rich aunt wants to contribute additional money from her bank account, she absolutely can. However, those contributions generally won't be quite as tax-efficient because they won't qualify for the payroll tax savings associated with pre-tax payroll deductions.
The good news? Those contributions are still generally deductible on your federal income tax return through Form 8889, provided you meet the HSA eligibility requirements and stay within the annual contribution limits. The deduction belongs to the HSA account owner, regardless of who actually contributed the money.
Is an HSA the same as an FSA?
No! Both Flexible Spending Accounts (FSA) and Health Savings Accounts (HSA) allow you to use pre-tax dollars to pay for qualified medical expenses. However, HSAs offer several additional benefits that traditional FSAs do not.
Just look at the names. One is designed primarily for SPENDING, while the other offers the opportunity for long-term SAVING. That's an important distinction.
Here are some of the biggest differences:
Use it or lose it: FSAs generally require you to spend the money within the plan year, although some plans allow a limited carryover or grace period. HSAs have no such requirement. Every dollar you don't spend remains in your account, year after year, with no expiration date.
Investment opportunities: HSAs generally allow you to invest your balance in mutual funds, ETFs, or other investments, depending on your HSA provider. Traditional FSAs don't offer investment opportunities. This gives your HSA the potential to grow over decades, rather than simply serving as a way to pay this year's medical bills.
Ownership and portability: Your HSA belongs to YOU, not your employer. Change jobs? Retire? Switch health insurance plans? The account and its balance stay with you. FSAs are generally tied to your employer, and unused benefits can be forfeited when you leave.
Tax-free growth: HSA investments can grow tax-free at the federal level, and distributions for qualified medical expenses are also tax-free. FSAs offer tax savings on contributions and qualified reimbursements, but they don't provide the same long-term investment and compounding opportunities.
Reimbursement flexibility: With an HSA, there's generally no deadline to reimburse yourself for qualified medical expenses incurred after the account was established. You can pay out of pocket today, let your HSA investments grow, and reimburse yourself years or even decades later. FSAs generally reimburse expenses incurred during the applicable coverage period.
An FSA is primarily designed to help you pay for medical expenses today. An HSA can help you pay for medical expenses today, tomorrow, or 30 years from now.
Qualified Medical Expenses
Qualified medical expenses (QMEs) extend far beyond typical doctor’s office visits and prescriptions. HSA funds can be used to pay for cold medicine, pain relievers, sleep aids, allergy medications, eye drops, over-the-counter drugs, certain skincare products, heartburn medications, acupuncture, Band-Aids, laser eye surgery, braces, sunscreen, contraceptives, after-sun aloe vera products, feminine hygiene products, and much more.
HSA funds can also be used to pay for qualified medical expenses incurred by you, your spouse, and eligible dependents.
Here are my favorite websites to look-up QMEs:
HDHP Costs
If your goal is to have the absolute lowest out-of-pocket expenses, an HDHP may not be the right fit. Everyone’s health situation and medical needs are different. Even someone in excellent health may not want to roll the dice on potentially higher out-of-pocket costs, regardless of the lower premiums, tax savings, and investment opportunities an HDHP/HSA combination offers.
However, make sure you do your homework using the OPM FEHB Plan Comparison Tool. Some non-HDHP plans may have deductibles approaching those of an HDHP, without offering the same HSA benefits.
Most importantly, don't forget to compare your net annual costs. Once you factor in GEHA HDHP's $1,000/$2,000 annual premium pass-through, potentially lower bi-weekly premiums, and HSA tax savings, you may discover that your non-HDHP plan actually costs you more overall.
Preventive Care
Please don’t neglect your health because you’re worried about out-of-pocket costs. With an HDHP, preventive services such as annual physical exams, routine screenings, immunizations, and other preventive care are generally covered by insurance before you meet your deductible, with no out-of-pocket costs, coinsurance, or copays. Depending on your plan, this may also include benefits such as two dental cleanings per year. With GEHA HDHP, I’m eligible for two dental cleanings per year and one eye exam.
Deductible
This is the amount you pay out-of-pocket before plan benefits begin. The 2027 GEHA HDHP in-network deductible is $1,800 for self-only and $3,600 for self plus one and family coverage (no increase from 2026).
Click here to see more details regarding costs for specialists, ER visits, maternity, chiropractic, etc.
Coinsurance
Coinsurance kicks in after you’ve met your annual deductible. Primary care office visits, lab work, X-rays, emergency room visits, and specialist visits generally have a 5% coinsurance when using in-network providers.
Let’s say you visit the doctor’s office and the bill is $100. However, the in-network provider has an agreement with GEHA to accept $80 as the allowed amount.
If you HAVE NOT met your annual deductible: You pay $80, which counts toward your deductible.
If you HAVE met your annual deductible ($1,800/$3,600): You pay just $4 (5% of the $80 allowed amount), and GEHA covers the remaining $76.
Prescriptions
You’ll most likely pay between 25% - 40% coinsurance with in-network providers. Please review the 2027 FEHB HDHP Medical Plan Brochure for full details. *Note: as of this writing, the 2027 brochure is not published yet, so I do not yet know if these amounts will change.
Maximum Out-of-Pocket/Catastrophic Limit
This is the maximum you'll pay in deductibles, copays, and coinsurance for covered medical services and prescriptions before insurance pays 100% of covered expenses for the remainder of the year.
The annual in-network OOP maximum for GEHA HDHP in 2027 is $6,000 for Self Only and $12,000 for Self Plus One or Self and Family (no increase from 2026). The 2026 out-of-network maximums are $8,500 and $17,000, respectively. *Note: as of this writing, the 2027 brochure is not published yet, so I do not yet know if the out-of-network maximums will change.
Remember, the catastrophic limit is different from your annual deductible. GEHA starts sharing the cost of covered services once you've met your $1,800/$3,600 annual in-network deductible. You don't have to reach the much higher catastrophic limit before insurance starts paying.
Certain expenses, such as charges above the plan's allowed amount, don't count toward your OOP maximum and may still be your responsibility.
Real Life Billing Example
I’m going to walk through some medical bills that I received after a procedure in 2025. Please note, I’ll be using the 2025 annual in-network deductible and out-of-pocket maximums.
(1) Individual Deductible vs. Individual Out-of-Pocket
Below is a screenshot from my GEHA HDHP portal. You can see that I met the $1,650 deductible in 2025. After reaching my deductible, I paid an additional $141.68 in coinsurance. Remember, even after reaching your deductible you still may have to pay coinsurance, which for all of my medical needs was 5% of the amount due to the provider.
I paid $1,650 towards the deductible + $141.68 coinsurance, for a total out-of-pocket cost of $1,791.68, which you can see is applied towards the $6,000 maximum.
From GEHA: “Individual deductible vs Family deductible: An individual deductible is what you must pay for health care services before your plan begins to pay. A family deductible is what your family must pay for health care services before your plan begins to pay.”
From GEHA: “Individual out-of-pocket vs Family out-of-pocket: An individual out-of-pocket is the maximum amount that you must pay for health care services (usually for the year) before your plan pays 100 percent of the eligible care you receive. A family out-of-pocket is the maximum amount your family must pay for health care services (usually for the year) before your plan pays 100 percent of the eligible care you receive. This never includes premium, balance-billed charges, or health care services your plan doesn’t cover. Some plans may not count all your co-payments, deductibles, co-insurance payments, out-of-network payments, or other expenses towards this limit.”
(2) Coinsurance
After my procedure, I received multiple Explanation of Benefits (EOB) statements from GEHA, all with separate claim numbers.
Claim 1
When this was billed, I was about $190 short of meeting my $1,650 annual deductible. This is why you can see amounts ($41.99 & $143.18) in the “applied to deductible” column.
Claim 2
When this was billed, I had met my annual $1,650 deductible. This is why you see no amount in the “applied to deductible” column. Notice there is still coinsurance. The “amount due to provider” for anesthesia services was $446.40, the coinsurance is 5%, which means I owed $22.32.
Claim 3
When this was billed, I had met my annual $1,650 deductible. This is why you see no amount in the “applied to deductible” column. Notice there is still coinsurance. The “amount due to provider” for surgery was $292.58, the coinsurance is 5%, which means I owed $14.63.
What if you don’t want to invest the money?
You don’t have to. You can still come out ahead by paying for QMEs with pre-tax dollars. This approach is more similar to how you would use an FSA.
What If you’re not healthy?
An HDHP may actually provide better financial protection if you have significant medical expenses and reach your annual “catastrophic limit.”
While choosing health insurance is a highly personal decision, it’s important to understand how each plan handles out-of-pocket expenses. Some traditional insurance plans have separate rules or limits for prescription drugs and other services, meaning you may still have certain expenses even after reaching the plan's catastrophic limit.
With an HDHP, once you've reached the catastrophic limit, the plan generally covers 100% of eligible in-network medical services and prescriptions for the remainder of the year. This is why it's important to compare not just premiums and deductibles, but also each plan's catastrophic limit and what expenses count toward it.
On 2/27/25, OPM issued Letter Number 2025-04 which stated, “Beginning January 1, 2026, all
carriers are required to accumulate each member’s out-of-pocket costs for plan-covered services toward the plan’s catastrophic maximum.” Moreover, “Carriers have flexibility to establish separate medical and pharmacy out-of-pocket (OOP) limits, but both the medical and pharmacy OOP limits must accumulate toward the plan’s catastrophic maximum, including when the member is enrolled in an EGWP (Employer Group Waiver Plan) offered under the plan. Carriers may not exclude the entire medical or pharmacy OOP limit from the plan’s catastrophic maximum.”
Here's what OPM published regarding HDHP's protecting you against catastrophic out-of-pocket expenses:
What if you’re too healthy?
Medicare Part B
While you may be a top-notch physical specimen today, it’s unlikely that you’ll never need money for any QME. Remember, you can always reimburse yourself at any time in the future for those every day common QMEs. And what about Medicare Part B? Many feds who have FEHB coverage and Medicare Part B in retirement report no additional out-of-pocket costs above their monthly premiums.
How much will you need to have saved and invested to comfortably afford Medicare Part B premiums in retirement?
From 1966 to 2026, Medicare Part B premiums increased from $3.00 to $202.90 per month. That's a compound annualized increase of approximately 7.28% over 60 years.
Here's what premiums have looked like over the past few years:
2023: $164.90/month
2024: $174.70/month (5.94% increase)
2025: $185.00/month (5.90% increase)
2026: $202.90/month (9.68% increase)
Let's be optimistic for a moment and assume Part B premiums increase by only 5% annually going forward.
If that happens, what might Part B premiums look like at age 65 for people who are still working today?
A few caveats with these simple projections: We're assuming a constant 5% annual premium increase, which is unlikely. Some years will see smaller increases, while others may see larger ones. We're also assuming no subsidies, reimbursements, or other assistance to offset premiums.
These figures are expressed in future dollars, not today's purchasing power. They assume 20 full years of premiums, from age 65 through age 84. The point isn't to predict exactly what Medicare will cost decades from now. It's to illustrate how seemingly modest annual increases can compound into substantial retirement expenses.
Here's where your HSA becomes particularly valuable.
Once you're enrolled in Medicare, you can use your HSA funds tax-free to pay Medicare Part B premiums, Part D premiums, and Part C/Medicare Advantage premiums (but NOT Medigap). That means the money you've been saving and investing throughout your working years can eventually help cover one of your recurring retirement expenses without generating additional taxable income.
This is another compelling reason to consider investing your HSA funds for the long term, rather than spending down the account every year. The longer you allow those investments to compound, the more money you may have available to cover healthcare expenses in retirement.
Finally, we haven’t factored in any Income Related Monthly Adjustment Amount (IRMAA). IRMAA is an additional tax/surcharge on your Medicare Part B and Part D premiums once you reach certain income thresholds. There is a two-year look back when figuring out if you have to pay IRMAA.
Paying Medicare Part B/C/D premiums with tax-free HSA dollars may also help you avoid higher Income-Related Monthly Adjustment Amount (IRMAA) surcharges. Why? Qualified HSA distributions don't increase your modified adjusted gross income (MAGI), which is used to determine IRMAA. On the other hand, withdrawing money from a traditional TSP or traditional IRA to pay those same premiums generally increases your taxable income and could push you into a higher IRMAA bracket two years later.
Long-Term Care
You can also use HSA dollars to pay for qualified long-term care (LTC) insurance premiums, subject to IRS age-based limits (see chart below). Not all LTC insurance policies will qualify. These policies can be expensive, making this another valuable use of your HSA funds.
Bottom line
The odds are good that at some point in your life, you'll have medical expenses that could be paid with tax-free money that's been compounding for decades.
Worst-case scenario? Once you reach age 65, your HSA essentially functions like a traditional IRA for non-qualified withdrawals. You can use the money for ANY purpose, and you'll only owe ordinary income tax, with no additional 20% penalty. Qualified medical expenses, on the other hand, always remain tax and penalty-free.
HSA Cons
(1) State Tax Treatment: Generally speaking, California and New Jersey do not conform to federal HSA tax rules. As a result, your HSA contributions will not reduce your state taxable income. Additionally, dividends, interest, and realized capital gains within your HSA investment account may be taxable at the state level each year. Consult with your financial or tax professional, but don't let this discourage you. I still had an HSA when I lived in New Jersey because the benefits far outweighed the state tax annoyance.
(2) Death: While death is already a pretty big con in general, it comes with an additional downside for some beneficiaries: HSAs aren't necessarily the most tax-friendly accounts to inherit, depending on your relationship to the deceased account owner. DISCLAIMER: I am not an attorney or an expert in estate planning, estate taxes, or inheritance law. Consult with your attorney for guidance specific to your circumstances.
Spousal Beneficiary
If you die, your spouse can inherit your HSA and treat it as their own (§223(f)(8)(A)).
Non-Spouse Beneficiary
However, if your spouse subsequently dies and leaves the HSA to a non-spouse beneficiary, or if you name someone other than your spouse as your beneficiary, the account loses its HSA status upon the account owner's death (§223(f)(8)(B)(i)(I)).
When the HSA ceases to be an HSA for non-spouse beneficiaries, the fair market value of the account generally becomes taxable income to them in the year of the account owner's death. Depending on the account balance and the beneficiary's tax situation, this could create a substantial tax liability.
But there is a way to reduce the tax liability.
A non-spouse beneficiary can use the HSA funds to pay for the deceased account owner's qualified medical expenses that were incurred but not paid before death. These expenses must be paid within one year of death, and the amounts paid reduce the HSA value included in the beneficiary's taxable income (§223(f)(8)(B)(ii)).
Spousal beneficiaries can also use the HSA funds to pay for unpaid medical expenses, but there is no time limit since the HSA is now theirs.
What about an estate as beneficiary?
Unlike an IRA, if your HSA passes to your estate, the fair market value of the account as of your date of death is included in your taxable income on your final federal income tax return (§223(f)(8)(B)(i)(II)).
Note: An estate beneficiary CANNOT reduce the taxable amount by the qualified medical expenses that were incurred prior to death but not yet paid. The “Special rules” section explicitly excludes estates.
An IRA works differently. Traditional IRA distributions are generally considered income in respect of a decedent (IRD), meaning the income is taxable to whoever receives it. For example, if your child inherits your traditional IRA and takes distributions, those distributions are generally taxable to them.
If your estate inherits the IRA, the estate generally reports taxable distributions on Form 1041. However, if the estate passes that taxable income through to its beneficiaries, the income may instead be reported to those beneficiaries on Schedule K-1, making them responsible for the associated income tax.
What about prior unreimbursed qualified medical expenses that the deceased didn’t get to reimburse themselves for?
Spousal Beneficiaries, as outlined under §223(f)(8)(A), are allowed to treat the HSA as their own. They can use HSA funds to reimburse themselves for prior qualified medical expenses that were paid prior to the original owner’s death but not yet reimbursed.
Non-spousal beneficiaries cannot use the HSA funds to reimburse themselves for prior unreimbursed qualified medical expenses that were paid by the deceased.
Final Thoughts
You can think of your HSA as a quasi-retirement account, with the added benefit of being able to use the funds immediately for qualified medical expenses or reimburse yourself for eligible expenses down the road. At some point, we'll all have medical expenses, whether it's long-term care, Medicare premiums, or extra sunscreen for those retirement days spent sitting on the beach with an umbrella drink in hand.
If your family's healthcare needs and financial situation allow, you may want to consider taking advantage of the immediate tax savings, lower insurance premiums, premium pass-through (PPT) contributions, and tax-free investment growth.
Tax Time – Documenting Your HSA Activity
Reporting
5498-SA: You'll receive Form 5498-SA from your HSA custodian showing how much was contributed to your account during the tax year. Note: Form 5498-SA typically arrives after the April tax filing deadline because HSA contributions for the prior tax year can be made up until that deadline. Don't worry if you haven't received it before filing your taxes. You don't need Form 5498-SA to file your return; just make sure you accurately report your HSA contributions on Form 8889.
1099-SA: If you took any distributions, you'll also receive Form 1099-SA reporting those withdrawals.
8889: You or your tax professional will need to file IRS Form 8889 with your federal income tax return to report your HSA contributions, employer contributions, distributions, any additional taxes owed, qualified HSA funding distributions, etc.
You don't have to submit receipts with your tax return proving that your HSA distributions were used for qualified medical expenses. However, you'll still want to save those receipts and maintain a good recordkeeping system in case the IRS comes knocking. This is especially important if you plan to reimburse yourself decades down the road for medical expenses you paid out of pocket today.
Below is an example of Form 8889 for an employee who contributed $4,150 (including the premium pass-through) via payroll deduction. They do not get any additional deduction at tax time (line 13) because they already had their income reduced by their HSA contributions, reflected in Box 1 of their W-2. The full $4,150 is reported on Line 9.
Below is an example of Form 8889 for an employee who contributed $3,150 from an external bank account, not via payroll deduction (line 2), plus the $1,000 premium pass-through (line 9). They get to deduct $3,150 from their federal income (line 13) because they only received a reduction in taxable income from the $1,000 premium pass-through. They did not yet get a tax deduction on the $3,150 because those are post-tax dollars from an external bank account.
Double-Dipping 1 – Deducting Contributions Twice
If you contribute to your HSA via pre-tax payroll deductions, DO NOT report those same contributions on Form 8889, Part I, Line 2. You've already received the tax benefit because those contributions reduced the taxable wages reported on your W-2. Reporting them again on Line 2 would effectively mean claiming the same tax benefit twice. See Line 2 on Form 8889 below.
The IRS instructions for Line 2 specifically state, "Do not include employer contributions (see line 9)."
IMPORTANT: For HSA reporting purposes, "employer contributions" also include contributions YOU make through your employer's cafeteria plan (a.k.a. pre-tax payroll deductions). These contributions are generally reported in Box 12 of your W-2 using Code W and belong on Line 9 of Form 8889, not Line 2.
Here’s my W-2 from 2025. You can see $3,300 in Box 12d. This is the amount I contributed to my HSA via payroll deduction. This amount, combined with the $1,000 GEHA premium pass-through, brought me to the 2025 annual contribution limit of $4,300. Both my contributions and the premium pass-through should be reported on Line 9 of Form 8889.
Double-Dipping 2 – Reimbursing Yourself for a Medical Expense and Using that Same Medical Expense to Itemize Deductions
When you file your taxes, you can either take the standard deduction or itemize your deductions on Schedule A (see line 12e on the 2025 version of Form 1040). This is a big part of the equation that determines your total tax liability for the year.
Generally, you will only want to itemize if your total itemized deductions exceed the standard deduction. The standard deduction is considerably larger than it was prior to the passage of the Tax Cuts & Jobs Act.
“In 2017, 30.6% of filers itemized deductions; in 2023, 9.5% did. In that same timeframe, the portion of returns claiming the standard deduction grew from 69.4% to 90.5%." Source: USAFacts
However, this may be changing for a few years.
Itemized Deductions for tax years 2025-2029
With Section 70120 of the One Big Beautiful Bill Act, you may actually start itemizing deductions, depending on your State & Local Tax (SALT).
Under the prior law, the maximum amount of SALT you could add on your Schedule A was $10,000. If you paid $15,000 in state income tax and local property tax, too bad, you were stuck with the lesser $10,000 deduction, essentially throwing away the other $5,000.
Under the OBBBA, the SALT limit has been increased from $10,000 to $40,000, and will increase by 1% each year. So, in 2026, the SALT limit will be $40,400.
For those who itemize, or are close to being able to itemize, this could be a big deal. Like most things in life, there are a few catches.
(1) This is only in effect from 2025-2029, in 2030 it goes back to $10,000.
(2) You must itemize deductions to take advantage of this.
(3) $40,000 is the limit, regardless of whether you file Single or Married Filing Jointly.
(4) The limit is reduced to $20,000 for those who file Married Filing Separately.
(5) There are income phase-outs.
INCOME PHASE-OUT
The amount of the reduction to your SALT deduction is 30% of the amount you’re over the threshold.
Single & MFJ: $500,000 MAGI threshold (set to increase annually with inflation until 2030).
Married Filing Separately: $250,000 MAGI threshold (set to increase annually by 1% until 2030).
Here's an example:
If a tax filer (single or MFJ) has $600,000 worth of income, they’re $100,000 over the $500,000 threshold. 30% of $100,000 = $30,000. The maximum SALT deduction of $40,000 is reduced by $30,000 for a final SALT deduction of $10,000. The income phase-out will not make the SALT deduction smaller than $10,000. Regardless of income level, $10,000 is as small as the SALT deduction will get.
All this to say, it's worth doing the math to see if itemizing will result in less tax liability.
Itemizing Medical Expenses vs. HSA Reimbursement
Let's say you had a lot of unreimbursed medical expenses this year. You can choose to deduct eligible medical expenses as part of your itemized deductions on Schedule A to the extent they exceed 7.5% of your adjusted gross income (AGI).
For example, if your AGI is $100,000, only eligible, unreimbursed medical expenses exceeding $7,500 would qualify as an itemized deduction on Schedule A. If you had $10,000 in eligible unreimbursed medical expenses, you could deduct $2,500, along with your other eligible itemized deductions (state and local taxes, home mortgage interest, charitable contributions, etc.). Why only $2,500? Because the 7.5% AGI floor wipes out the first $7,500 worth of expenses from your total $10,000 unreimbursed medical expense amount.
IMPORTANT: Just because you can itemize certain expenses doesn't mean you should. The standard deduction may still be larger.
To keep things simple, you cannot use the same medical expense to claim two tax benefits. Medical expenses deducted on Schedule A must be unreimbursed. Schedule A even includes this warning: "Caution: Do not include expenses reimbursed or paid by others."
So, if you have money in your HSA and you're considering itemizing your deductions, you generally have three options for handling those qualifying medical expenses.
Option A: Use Your HSA
Pay for the qualified medical expense now using HSA dollars or pay out-of-pocket and reimburse yourself tax-free from your HSA at any point in the future.
-OR-
Option B: Itemize Your Medical Expenses on Schedule A
Pay out-of-pocket and claim the eligible unreimbursed medical expenses as an itemized deduction on Schedule A (subject to the 7.5% AGI threshold).
-OR-
Option C: Combine Both Strategies (Itemize AND Use HSA Dollars)
You can potentially take advantage of both strategies, but you cannot claim two tax benefits for the same expense.
Let's say your AGI is $80,000 and you incur $10,000 in eligible medical expenses. Because 7.5% of your AGI is $6,000, only $4,000 of those expenses would qualify for a Schedule A medical expense deduction.
You could potentially:
Claim $4,000 as an itemized medical expense deduction on Schedule A.
- AND -
Separately reimburse yourself $6,000 tax-free from your HSA for the remaining eligible medical expenses.
The result? You've used $4,000 in medical expenses to claim an itemized deduction and another $6,000 to obtain tax-free HSA reimbursement, without using the same expenses for both benefits. This assumes you have enough other itemized deductions to make itemizing worthwhile, and that the expenses qualify under the applicable HSA rules.
WORTH REPEATING: If you claim a medical expense as an itemized deduction on Schedule A, you cannot later reimburse yourself tax-free from your HSA for that same expense. This applies even if you wait several years before requesting reimbursement. The IRS specifically prohibits using medical expenses that have already been claimed as itemized deductions to later take tax-free HSA distributions.
Bonus Topic 1 – Double HSA Funding for Adult Children
I've seen some articles refer to this as a "loophole," but just like the "backdoor" Roth IRA (which sounds a little shady), this strategy is completely legitimate and permitted under the tax code.
Bottom line up front: Your adult child, who is (1) under age 26, (2) cannot be claimed as anyone's tax dependent, and (3) is covered under your family HDHP, may be eligible to contribute the full $9,000 family HSA contribution limit in 2027 to their own individually owned HSA.
This is a big deal. Your child could contribute $9,000 to their HSA, while you could separately contribute $9,000 to your own HSA.
You could even give your child the money to fund their HSA. Remember, anyone can contribute to someone else's HSA. This would generally be considered a gift for federal gift tax purposes, but the annual gift tax exclusion is $19,000 per recipient in 2026.
So, a gift of $8,750 (the 2026 annual HSA contribution limit for self plus one & self and family) ordinarily wouldn't require you to file a gift tax return, assuming you haven't made other gifts to that child that push you over the current $19,000 annual exclusion.
Even if you did exceed the $19,000 annual exclusion, that still doesn't necessarily mean you'll owe any gift tax. You would generally need to file IRS Form 709, but the excess would simply reduce your remaining lifetime estate and gift tax exemption, which is $15 million per individual in 2026 ($30 million combined for a married couple). So, if you gave someone $20,000 this year, your lifetime exemption would be reduced to...$14,999,000. How? $15 million lifetime estate & gift tax exemption minus the $1,000 that you exceeded the $19,000 annual limit this year.
A key point to remember: the HSA tax deduction belongs to the account owner, regardless of who contributed the money. In this example, your child would claim the deduction on their own tax return using IRS Form 8889. Contributions you make to your child's HSA on their behalf should be reported on Line 2 (see screenshot below) of their Form 8889 filed with their return.
Your child getting a federal income tax deduction isn't the biggest takeaway from this strategy. They may have very little taxable income to offset and could already be in one of the lower tax brackets. The real power of this strategy is getting money into an account early in life, where it can grow and compound tax-free for decades.
Eligibility for Adult Children (*and everyone else*) to Contribute to an HSA
This should look familiar: In order to contribute to an HSA, you must meet ALL FOUR requirements, which can be found under 26 U.S. Code § 223 and on page 3 of IRS Publication 969 (2025).
(1) The adult child must be covered by an HSA-eligible high-deductible health plan (HDHP).
(2) The adult child cannot have other disqualifying health insurance coverage. Note: They CAN have vision, dental, accident, disability, long-term care, and various “other health coverage” options outlined on page 4 of IRS Publication 969.
(3) The adult child cannot be enrolled in Medicare.
(4) The adult child cannot be eligible to be claimed as a dependent on someone else's tax return.
Here's the key distinction that trips people up: Your adult child CANNOT QUALIFY AS ANYONE'S TAX DEPENDENT—not just yours, but anyone's.
There's a difference between not qualifying as a dependent (because they don't meet the Qualifying Child or Qualifying Relative tests) and qualifying as a dependent but simply not being claimed by anyone. Just because you choose not to claim your adult child on your tax return doesn't automatically make them eligible to contribute to their own HSA.
There are two ways someone can qualify as a dependent:
(1) Qualifying Child
(2) Qualifying Relative
-Qualifying Child Test-
Your child CAN be claimed as a dependent if they meet ALL FIVE of the following tests (source: IRS Publication 501):
(1) Age Test: The child is under age 19, OR under age 24 and a full-time student. To be a full-time student, the child must be full-time for “some part of each of any 5 calendar months of the year.” The months do not have to be consecutive. Note: There is no age limit if the child is permanently and totally disabled. Lastly, the child must be younger than you (or your spouse if filing jointly), unless permanently and totally disabled. This might seem odd – of course your child is going to be younger than you. When you get to the “Relationship Test”, this will make more sense.
(2) Residency Test: The child lived with you for more than 50% of the year (there are some exceptions to include kidnapped children, those who were born/died during the year, and qualifying temporary absences). Time spent away from home for college, vacation, juvenile detention, illness, business, and education are generally counted as a qualifying temporary absence, meaning they can still meet this requirement.
(3) Financial Support Test: The child did NOT provide more than 50% of their own financial support during the year. This is important. Your child could have a job and earn $30,000, but if they save most of that money while you pay their living expenses, they might still qualify as your dependent. It's about how much of their own money they actually spent on their own support, not simply how much they earn.
(4) Relationship Test: The child must be your son, daughter, stepchild, eligible foster child (placed by an agency), brother, sister, half-sister or -brother, stepbrother, stepsister, adopted child or the child of one of these. Now you can see why the age prong requires the "child" be younger than you. The "child" in this case could be your brother, sister, half siblings, step-siblings, or adopted children, who could all be older than you.
(5) Joint Return Test: The child generally cannot file a joint tax return with a spouse, with a limited exception for returns filed solely to recover taxes paid or withheld.
IMPORTANT: A child who fails the Qualifying Child test might still qualify as a dependent under the Qualifying Relative test. You must consider both before determining whether the child is eligible to contribute to their own HSA. For example, your 25-year-old child might be too old to qualify as a qualifying child, but if you provide more than half of their financial support and their gross income is below the IRS annual threshold explained below, they could still qualify as your dependent.
-Qualifying Relative Test-
An individual CAN be claimed as a dependent if they meet ALL FOUR of the following tests (source: IRS Publication 501):
(1) Qualifying Child Test: They are not the Qualifying Child of any taxpayer.
(2) Member of Household/Relationship Test: The individual must either (a) live with the taxpayer for the entire year or (b) have a qualifying family relationship. A son or daughter satisfies the relationship requirement regardless of age and generally does not have to live with the parent. Note: any individual who lives with you for the entire year can technically be a qualifying “relative”, even if they aren’t a relative. Your girlfriend/boyfriend, childhood friend, or roommate could technically be your qualifying “relative”.
(3) Gross Income Test: The individual's gross income must be below the annual IRS threshold. For 2026, that threshold is $5,300. If they have gross income of $5,300 or more, they cannot be your qualifying relative.
(4) Support Test: You must provide more than 50% of the individual's total financial support during the calendar year in order to claim them as a dependent. Support includes housing, food, clothing, education, medical expenses, transportation, and other necessities.
Rules for All Dependents (Qualifying Children & Qualifying Relatives)
This is directly from IRS Publication 501:
(1) You can’t claim any dependents if you, or your spouse if filing jointly, could be claimed as a dependent by another taxpayer, unless that taxpayer files a return only to claim a refund of withheld income tax or estimated tax paid.
(2) You can’t claim a married person who files a joint return as a dependent unless that joint return is filed only to claim a refund of withheld income tax or estimated tax paid.
(3) You can’t claim a person as a dependent unless that person is a U.S. citizen, a U.S. resident alien, a U.S. national, or a resident of Canada or Mexico.
(4) You can’t claim a person as a dependent unless that person is your qualifying child or qualifying relative.
So, What Are the Key Takeaways for Funding an Adult Child's HSA?
If your child meets all five prongs of the Qualifying Child test they CANNOT contribute to their own HSA because they COULD be claimed as a dependent.
If your child meets all four prongs of the Qualifying Relative test they CANNOT contribute to their own HSA because they COULD be claimed as a dependent.
Scenario 1: Adult Child Who CAN Fund An HSA
Let's say your 22-year-old daughter lives at home and is covered under your family HDHP for 2026. She's graduated from college, works full-time, earns $45,000 annually, and pays more than 50% of her own total financial support. Assuming she meets the other HSA eligibility requirements and is eligible for the full-year family contribution limit, she could contribute the full $8,750 family HSA limit in 2026 to her own HSA, completely separate from your HSA contributions.
Why?
Because she provides more than half of her own financial support, she fails the support test to be a Qualifying Child. She also fails the Qualifying Child test because she is 22 and no longer a full-time student. Because she earns $45,000 annually, she exceeds the $5,300 gross income limit and therefore fails the Qualifying Relative test.
She CANNOT BE CLAIMED as a dependent by anyone and therefore CAN CONTRIBUTE to her own HSA (assuming she meets all other requirements).
Scenario 2: Adult Child Who CANNOT Fund Their Own HSA
She's still your daughter (relationship), she's 22 (age), lives at home (residency), attends college full-time for at least five months of the year (student status), doesn't file a joint tax return (joint return), and you pay nearly all her living expenses (financial support).
Even if you choose not to claim her on your tax return, she CANNOT CONTRIBUTE to her own HSA.
Why?
Because she meets the requirements to be your Qualifying Child and therefore CAN BE CLAIMED as your dependent.
Bonus Topic 2 – Qualified HSA Funding Distribution (QHSAFD)
To keep this very simple, think of a QHSAFD as a tax-free transfer of pre-tax traditional IRA dollars into your tax-free HSA. You can also make a QHSAFD from a Roth IRA, but that's generally not as optimal from a tax perspective as transferring pre-tax traditional IRA dollars.
Think of your traditional IRA as a joint account with the IRS as the other owner.
If you have $100,000 in a traditional IRA, you don't really have $100,000 to spend. Why? Because the dollars in that account have never been taxed, assuming you received a deduction when you made the contributions. You could have made non-deductible contributions, but for now, let's keep it simple and assume all the dollars are pre-tax.
Eventually, either you or your heirs will generally pay income tax on those dollars. There are exceptions, such as leaving the IRA to charity, but again, let's try to avoid the rabbit holes.
Wouldn't it be nice to take some of those tax-deferred dollars the IRS is waiting to tax and transform them into tax-free HSA dollars that the IRS may never get to touch?
That's exactly what a QHSAFD can accomplish.
Eligibility to perform the QHSAFD
(the first four should look very familiar)
(1) You're covered by an HSA-eligible high-deductible health plan (HDHP) at the time of the transfer.
(2) You have no disqualifying health insurance coverage.
(3) You are not enrolled in Medicare.
(4) You cannot be claimed as someone else's tax dependent.
(5) You have a traditional IRA or Roth IRA. Ongoing SEP IRAs and SIMPLE IRAs do not qualify.
(6) You have not previously completed a QHSAFD during your lifetime (one exception explained below).
(7) The transfer goes directly from your IRA custodian (Vanguard, Fidelity, Schwab, etc.) to your HSA custodian (Fidelity, HSA Bank, Lively, etc.), not through your personal checking or savings account. You may see this referred to as a "trustee-to-trustee" transfer.
(8) The IRA and HSA must belong to the same individual. You cannot transfer your IRA dollars into your spouse's, child's, or anyone else's HSA.
(9) The transfer, combined with your other HSA contributions, cannot exceed your applicable annual HSA contribution limit, including any catch-up contributions.
(10) You must remain HSA-eligible through the last day of the 12th month following the month of the transfer (more on this below).
Important Points
Is There Any Tax Due?
No. A properly completed QHSAFD is excluded from taxable income, provided you satisfy the applicable requirements, including the testing period.
Is There a 10% Early Withdrawal Penalty if You Perform a QHSAFD Before Age 59½?
No. A QHSAFD is not subject to the usual 10% early IRA withdrawal penalty, regardless of your age. However, there's one important exception worth mentioning. If you're currently taking Substantially Equal Periodic Payments (SEPPs) under Section 72(t) from an IRA in order to avoid the 10% early-withdrawal penalty, a QHSAFD could be considered a “modification” of that payment arrangement. This could trigger a recapture tax on your previous SEPP distributions.
Will You Get a Tax Deduction From the QHSAFD?
No. You DO NOT receive a current-year tax deduction. IRS Publication 969 states, "The distribution isn't included in your income, isn't deductible, and reduces the amount that can be contributed to your HSA."
How Much Can You Transfer from an IRA Into an HSA?
Up to your applicable annual HSA contribution limit (based on self-only, self plus one, or self and family coverage), including any catch-up contribution, minus other contributions that count toward that limit. Remember, your employer's contributions, including the GEHA premium pass-through, also count toward your annual limit.
Here’s an example for 2027:
$4,500 annual contribution limit for self-only (not age 55+)
(-) $1,000 premium pass-through
(-) $500 HSA contribution via payroll deduction
(-) $100 HSA contribution from checking/savings account
= $2,900 eligible for QHSAFD
Can You Make a QHSAFD Retroactively?
No. A QHSAFD counts for the calendar year in which the transfer actually occurs. You cannot make a QHSAFD in 2027 and designate it as a 2026 contribution.
Can You Undo a QHSAFD if You Change Your Mind?
No. Once completed, the QHSAFD election is irrevocable.
Can You Make a QHSAFD Directly from an Employer Retirement Plan Like the Thrift Savings Plan (TSP), 401(k), 403(b), or 457(b)?
No. A QHSAFD must come from an eligible traditional IRA or Roth IRA, including qualifying inherited IRAs. You could potentially roll eligible funds from an employer retirement plan into a traditional IRA first and then make a QHSAFD, assuming the rollover is permitted and you meet the other requirements.
Can You Make a QHSAFD From an Inherited IRA?
Yes. There is conflicting information in various articles regarding whether a QHSAFD can be made from an inherited IRA. However, IRS Notice 2008-51 specifically addresses this situation: "The distributions must be from an IRA or Roth IRA to an HSA owned by the individual who owns the IRA or Roth IRA or, in the case of an inherited IRA, for whom the IRA or Roth IRA is maintained (i.e., a qualified HSA funding distribution cannot be made to an HSA owned by any other person, including the individual's spouse)."
Additionally, the notice states: "After the death of an IRA or Roth IRA account owner, a qualified HSA funding distribution may be made from an IRA or Roth IRA maintained for the benefit of an IRA or Roth IRA beneficiary."
The notice also confirms that a QHSAFD from an inherited IRA counts toward satisfying the inherited IRA's required minimum distribution (RMD) requirements. The beneficiary must still satisfy the applicable HSA eligibility requirements, and the transfer must go directly into an HSA owned by that beneficiary.
Can a QHSAFD Come from Multiple IRAs?
Not directly. If you own multiple IRAs and want to use funds from more than one account, you must first consolidate the desired amount into a single IRA. For example, if you have $1,000 in one traditional IRA and $2,000 in another traditional IRA, and you want to make a $3,000 QHSAFD, you will first transfer the funds into one consolidated IRA. You could then make the $3,000 QHSAFD from that single IRA.
What if Your Traditional IRA Contains Basis?
The IRS does us a solid with this one.
Think of basis in your traditional IRA as contributions that you made with dollars that have already been taxed and did not provide a tax deduction.
If I took $200 from my Bank of America checking account, contributed that money to my traditional IRA, and did not claim a tax deduction, I would have $200 in basis in my traditional IRA. Those dollars have already been taxed and should not be taxed again.
IMPORTANT: If you make non-deductible contributions to a traditional IRA, you need to track your basis each year using IRS Form 8606. Your IRA custodian (Vanguard, Fidelity, Schwab, etc.) doesn't know whether you claimed a deduction on your tax return, so they're not going to track your after-tax basis for you. That's your responsibility.
But wait...why wouldn't you take a tax deduction for a traditional IRA contribution?
Like all things tax-related, there are rules. Your ability to deduct traditional IRA contributions depends on:
(1) Your Modified Adjusted Gross Income (MAGI). Unfortunately, there are many different MAGI's (Maggies?) for different scenarios.
For traditional IRA deductibility, Modified Adjusted Gross Income (MAGI) =
Start with your AGI (Form 1040, line 11)
(+) IRA deduction (Schedule 1, line 20)
(+) Student loan interest deduction (Schedule 1, line 21)
(+) Savings bond interest that's excludable (Form 8815, line 14)
(+) Employer provided adoption benefits excluded from income (Form 8839, line 28)
(+) Foreign earned income and/or housing excluded from income (Form 2555, line 45)
(+) Foreign housing deduction (Form 2555, line 50)
(2) Your filing status.
(3) Whether you or your spouse are covered by a workplace retirement plan. Not sure if you or your spouse are considered "covered" by a workplace retirement plan? Look at Box 13 on your Form W-2. For most government workers this is an easy one. However, it can get more nuanced when looking at private sector employers and self-employed individuals. Click here to see the Instructions for Form W-2, which provide a lot more detail into "active participant" status.
See the table below from Fidelity showing the restrictions for individuals covered by a workplace retirement plan in 2026.
Okay, back to basis in your account and how it comes into play with a QHSAFD.
Let's say you have a traditional IRA worth $2,000 (total account value). Of that $2,000, $200 represents a non-deductible contribution that you made in a previous year. You took $200 of after-tax money from your checking account, contributed it to the traditional IRA, did not take a deduction, and filed Form 8606.
You decide to execute a $1,500 QHSAFD from that $2,000 traditional IRA, that contains the $200 basis. Under the special QHSAFD rules, the $1,500 transfer is treated as coming entirely from your pre-tax IRA dollars, rather than pulling any basis out. This is a good deal.
The end result? You've transformed $1,500 of pre-tax traditional IRA dollars into tax-free HSA dollars. Money that would have eventually been taxed is now shielded from Uncle Sam by the HSA (assuming you play by all the rules).
What's left in your traditional IRA?
$500 total account value ($2,000 - $1,500 QHSAFD)
$200 in remaining after-tax basis (basis wasn’t touched)
$300 in remaining pre-tax dollars
Now, what happens if you withdraw $100 from that remaining traditional IRA? We now have a pro rata situation, where some basis will be distributed.
Under the normal pro rata distribution rules (assuming you have no other traditional, SEP, or SIMPLE IRA balances), the IRS would treat $40 of the $100 withdrawal as a tax-free return of basis and $60 of the $100 as taxable income.
Why?
Because 40% of your remaining IRA consists of after-tax basis ($200/$500) and 60% of your remaining IRA consists of pre-tax dollars ($300/$500).
The QHSAFD basis rule allows you to move pre-tax IRA dollars into your HSA while preserving your existing IRA basis, which can reduce the taxable portion of future IRA distributions.
Note: If you have multiple traditional, SEP, or SIMPLE IRAs, the IRS generally aggregates these accounts when calculating the taxable and non-taxable portions of ordinary IRA distributions. Instead of separate IRAs, the IRS just sees one giant IRA bucket. The simple example above assumes this is your only traditional IRA and that there are no other transactions affecting the pro rata calculation.
Is it Really "Once in a Lifetime"?
Kinda. Generally speaking, you're permitted only one QHSAFD during your lifetime. However, there's an exception if you switch from self-only to family HDHP coverage during the same tax year.
For example, if you’re under age 55 and make a $4,400 QHSAFD while covered by a self-only HDHP in 2026, and then later in 2026 switch to HDHP family coverage, you may be eligible to make a second QHSAFD of up to $4,350, bringing your total to the $8,750 family contribution limit.
Key points for this to work:
(1) The second QHSAFD must occur in a later month of the same tax year.
(2) You must have family HDHP coverage as of the first day of the month in which the second QHSAFD occurs.
(3) Your combined QHSAFDs and other HSA contributions cannot exceed your applicable annual contribution limit.
(4) You must satisfy the testing-period requirements.
IMPORTANT: Any Other Snags?
Possibly, yes. The testing period.
If you make a QHSAFD and want to avoid paying tax on the distribution, you must remain HSA-eligible from the month of the transfer through the last day of the 12th month following that month. It sounds confusing but it’s really not.
If you do a QHSAFD in October 2026, you must remain HSA-eligible through October 31, 2027.
If you lose HSA eligibility during that period, the entire QHSAFD becomes taxable income in the year you lose eligibility, and you'll generally owe an additional 10% tax. Exceptions apply if you lose eligibility because of death or disability.
Bonus - You can switch from family HDHP coverage to self-only HDHP coverage during the testing period without violating this rule, as long as you remain HSA-eligible. If you make two permitted QHSAFDs in the same year, each transfer has its own testing period.
What About Medicare?
This is especially important for retirees approaching age 65. If you make a QHSAFD and then enroll in Medicare before completing the testing period, you could trigger income tax and the additional 10% tax because you will fail the testing period.
Remember, you cannot be enrolled in Medicare and remain eligible to contribute to an HSA.
There’s also a unique nuance when it comes to Medicare Part A and retroactive coverage. If you enroll in Medicare Part A (free / no premiums) after age 65, your coverage may be retroactive for up to six months, but generally not earlier than the first month you were eligible for Medicare. This matters because retroactive Medicare enrollment can eliminate your HSA eligibility for months you previously believed you were eligible.
Let’s say you make a $4,400 QHSAFD in October 2026 and plan to remain HSA-eligible through October 31, 2027. You turn 65 in January 2027 but continue working, maintain your employer-sponsored HDHP coverage, and delay enrolling in all Medicare Parts. Then, in November 2027, you enroll in Medicare Part A. Your Part A coverage could be retroactive to May 2027. Even though you didn't apply for Medicare until November, you would retroactively be considered enrolled in Medicare beginning in May, which falls within your QHSAFD testing period.
Why does this matter? You could owe ordinary income tax on the $4,400 QHSAFD in the year the testing period failure occurs, plus an additional $440 in tax (10%).
Can a QHSAFD Satisfy a Required Minimum Distribution?
Yes! A QHSAFD can count toward satisfying an RMD from a traditional IRA, including an inherited traditional IRA. However, there's an important catch. Being subject to RMDs doesn't exempt you from the normal HSA eligibility requirements. For example, someone age 73 who is already enrolled in Medicare generally cannot make a QHSAFD, even though they're subject to RMDs.
On the other hand, someone who inherits a traditional IRA at age 45 and is covered by an HSA-eligible HDHP could potentially use a QHSAFD to satisfy some or all of the inherited IRA's annual RMD (subject to the annual HSA contribution limits).
What About Reporting for Tax Purposes?
The IRA custodian should issue you a 1099-R reporting the distribution.
The HSA custodian should issue you a 5498-SA reporting the contribution.
You, the taxpayer should file Form 8889 for the year the transfer occurred. Just because it’s excluded from income doesn’t mean it’s not reportable.
Is a QHSAFD the Best Way to Fund Your HSA?
Not necessarily. A QHSAFD doesn't result in a current-year income tax deduction, and it doesn't provide the 7.65% payroll tax savings you could receive by contributing to your HSA via payroll deductions. Why is it still something to consider? Because of the after-tax value generated by moving tax-deferred traditional IRA dollars to a tax-free HSA. If I had to choose between doing a QHSAFD or funding my HSA via payroll deduction, I would choose payroll deduction.
WARNING: Mail Handlers Benefit Plan (MHBP) Consumer Option Terminating in 2027
I know a few coworkers who currently have HDHP coverage with an HSA through the MHBP Consumer Option (enrollment codes 481, 482, and 483).
According to Table A5 of OPM's FEHB Significant Events Tables, the MHBP Consumer Option is being terminated at the end of 2026 (see screenshot below). Anyone enrolled in this option who doesn't actively select another FEHB plan during Open Season will be automatically enrolled in the MHBP Standard Option (enrollment codes 454, 455, and 456).
There are two major concerns that I can see with this:
1: MHBP Standard is NOT an HSA-eligible HDHP. If you're automatically transferred to this plan, you'll generally lose your eligibility to make additional HSA contributions. You can still maintain and use your current HSA money but won’t be eligible for contributions in 2027.
2: The premiums are increasing significantly. Depending on your enrollment type, you could end up paying thousands of dollars more per year for coverage that no longer allows you to contribute to an HSA.
Bottom line: If you're currently enrolled in MHBP Consumer, don't ignore Open Season this year. Review your options and make an active enrollment decision for 2027.
About the Author
Tyler Weerden is a fee-only financial planner, Enrolled Agent, and the owner of Layered Financial, a Registered Investment Advisory firm based in Arlington, Virginia. In addition to being a financial planner, Tyler is a full-time federal agent. He holds a Bachelor of Science degree, a Master of Science degree, passed the Series 65 exam, and is a Certified Fraud Examiner (CFE). Tyler is the sole Investment Adviser Representative at Layered Financial.
Prior to becoming a federal agent, Tyler served as a state trooper, local police officer, and was a member of the U.S. Army National Guard. He has served in both domestic and overseas Foreign Service assignments. Tyler has experience with local, state, and federal pension systems, 457(b) Deferred Compensation, the federal Thrift Savings Plan (TSP), Individual Retirement Accounts (IRAs), Health Savings Accounts (HSAs), and various investment options to include rental real estate.
Disclaimer
Layered Financial is a Registered Investment Adviser registered with the Commonwealth of Virginia, the State of Texas, and the State of Connecticut. Registration does not imply a certain level of skill or training. The views and opinions expressed are as of the date of publication and are subject to change. The content of this publication is for informational or educational purposes only. This content is not intended as individualized investment advice, or as tax, accounting, or legal advice. Nothing in this article should be seen as a recommendation or advertisement. Layered Financial and its Investment Advisor Representatives have no third-party affiliations and do not receive any commissions, fees, direct compensation, indirect compensation, or any benefit from any outside individuals or companies. Although we gather information from sources that we deem to be reliable, we cannot guarantee the accuracy, timeliness, or completeness of any information prepared by any unaffiliated third-party. When specific investments, types of investments, products, or companies are mentioned, such mention is not intended to be a recommendation or endorsement to buy or sell the specific investment, solicit the business, or use that product. The author of this publication may hold positions in investments or types of investments mentioned in articles. This information should not be relied upon as the sole factor in an investment-making decision. Readers are encouraged to consult with professional financial, accounting, tax, or legal advisers to address their specific needs and circumstances.
© 2026 Tyler Weerden. All rights reserved. This article may not be reproduced without express written consent from Tyler Weerden.
