Can I Use My HSA to Pay for a Massage?
Wondering if your massage qualifies for HSA coverage? This guide clarifies the IRS requirements and necessary steps for eligible therapy.
Health Savings Accounts (HSAs) offer a tax-advantaged way to save and pay for healthcare costs. These accounts are available to individuals enrolled in a high-deductible health plan (HDHP). Funds contributed to an HSA are tax-deductible, grow tax-free, and can be withdrawn tax-free for qualified medical expenses.
Defining Qualified Medical Expenses
The Internal Revenue Service (IRS) defines qualified medical expenses as costs primarily incurred for the diagnosis, cure, mitigation, treatment, or prevention of disease, or for treatments affecting any part or function of the body. These expenses must be for medical care and not merely for general health or wellness that is not tied to a specific condition.
Common examples of qualified medical expenses include doctor visits, prescription medications, hospital stays, and dental treatments. Over-the-counter medications and menstrual care products are also considered qualified medical expenses. However, expenses solely beneficial to general health, such as vitamins for general well-being or a vacation, typically do not qualify.
Massage Therapy Eligibility
Massage therapy can be considered a qualified medical expense, but only under specific conditions. It is not eligible if sought for general relaxation, stress relief, or overall wellness; instead, it must be prescribed by a licensed healthcare professional for a specific medical condition.
A valid prescription or a Letter of Medical Necessity (LMN) from a healthcare provider is essential. This documentation should clearly state the specific medical condition being treated, explain why massage therapy is medically necessary for that condition, and often include the recommended frequency and duration of the treatment. For instance, massage therapy might be prescribed for chronic back pain, specific injuries, fibromyalgia, or multiple sclerosis. Without this formal medical necessity, the expense is not qualified, and using HSA funds for it could result in income tax on the amount spent and a potential 20% penalty if the account holder is under age 65.
Documentation and Record-Keeping for HSA Expenses
Maintaining thorough records is important for all HSA expenses, particularly for those requiring substantiation like massage therapy. Account holders are responsible for verifying that expenses meet IRS criteria for qualified medical expenses. While you may not need to submit receipts to your HSA administrator for every transaction, retaining detailed documentation is a necessary practice for tax compliance.
Key documents to keep include detailed receipts or invoices from the massage therapist, which should specify the date, service provided, and cost. Also retain the medical professional’s prescription or the Letter of Medical Necessity. This letter must explicitly link the massage therapy to a diagnosed medical condition and outline the treatment plan. These records serve as proof of eligibility in the event of an IRS inquiry or audit.