Can I Buy Tampons With an HSA Card?
Navigate HSA eligibility for feminine hygiene products. Get practical guidance on using your HSA card and managing records for qualified healthcare expenses.
Health Savings Accounts (HSAs) offer a valuable financial tool for managing healthcare costs. These accounts are tax-advantaged savings and spending vehicles designed to help individuals save for and pay for qualified medical expenses. HSAs provide a way to reduce taxable income through contributions, allow tax-free growth of funds, and enable tax-free withdrawals for eligible healthcare needs.
Understanding Eligibility for Feminine Hygiene Products
Feminine hygiene products are recognized as qualified medical expenses for Health Savings Accounts. This eligibility was established with the passage of the Coronavirus Aid, Relief, and Economic Security (CARES) Act in March 2020. The types of products now considered eligible include items such as tampons, sanitary pads, panty liners, menstrual cups, and similar products used for menstruation. These products are specifically designed to absorb or manage menstrual flow and are now fully eligible without requiring a prescription.
Making Purchases with Your HSA Card
Using an HSA debit card for eligible purchases is similar to using a regular debit or credit card. At the point of sale, you can swipe your card and select “credit” or “debit,” entering a PIN if prompted. Many retailers, especially those primarily selling healthcare-related items, have inventory systems or merchant category codes (MCCs) that automatically identify eligible expenses. However, if a transaction is not automatically approved, it may require manual review or submission of a receipt for reimbursement from your HSA. It is important to ensure that the merchant’s system can process HSA card payments, particularly if they are not a dedicated medical merchant.
Maintaining Records for HSA Compliance
Maintaining accurate records for all HSA transactions is important, as the Internal Revenue Service (IRS) requires documentation demonstrating that HSA distributions were used exclusively for qualified medical expenses. This record-keeping is necessary for tax purposes and in case of an IRS audit, as you may face penalties if you cannot prove an expense’s eligibility. Key records to retain include itemized receipts, invoices, and Explanation of Benefits (EOB) statements from your health insurer. These records should be kept for at least as long as your tax return remains subject to audit, typically several years. Digital copies or organized physical files can help manage these documents.