Can You Use Your HSA for Transportation?

Health Savings Accounts (HSAs) serve as tax-advantaged savings and investment vehicles designed to help individuals cover qualified medical expenses. These accounts offer a triple tax benefit: contributions are tax-deductible, earnings grow tax-free, and withdrawals for eligible medical costs are also tax-free. This article clarifies if transportation expenses related to healthcare can be paid for using HSA funds, providing detailed guidance on what qualifies and how to properly substantiate these expenses.

What Qualifies as Medical Transportation

The Internal Revenue Service (IRS) defines qualified medical expenses broadly to include costs for the diagnosis, cure, mitigation, treatment, or prevention of disease, along with expenses for treatments affecting any bodily function or structure. Transportation costs can qualify as medical expenses if they are primarily for, and essential to, obtaining medical care. General travel or commuting expenses are not eligible.

Eligible transportation expenses encompass various methods used to access necessary medical care. This includes out-of-pocket costs for using a personal car, such as gas and oil, or utilizing the standard medical mileage rate. For 2025, the standard medical mileage rate remains at 21 cents per mile. Parking fees and tolls incurred during medical trips are also considered eligible expenses.

Public transportation fares, such as those for buses, trains, taxis, or ride-sharing services, are also qualified if the primary purpose of the trip is medical treatment. If specialized medical care is not available locally, airfare or other long-distance travel expenses to reach a medical facility can be eligible. Ambulance services are explicitly included as a qualified medical transportation expense.

Lodging expenses incurred for medical care away from home can be included, though specific limits may apply. For example, some guidance indicates up to $100 per night per person for lodging, and this can extend to a parent traveling with a child receiving care. However, meals are generally not considered a qualified medical expense. The key determinant for all these expenses is their direct link to and necessity for medical treatment, not for general health or convenience.

Certain transportation costs do not qualify as medical expenses. Commuting to work, even if a medical condition necessitates special transportation, is not eligible. Travel for general errands, non-medical reasons, or purely elective cosmetic procedures also falls outside the scope of qualified medical transportation. The expense must be directly tied to a medical purpose, rather than being for personal or non-essential travel.

How to Substantiate Transportation Expenses

Maintaining detailed records is essential for all Health Savings Account (HSA) expenditures, especially for qualified expenses like transportation. The responsibility for proving an expense is qualified rests with the account holder. Should the IRS ever audit an HSA, insufficient documentation could result in taxes and penalties on distributions.

To adequately substantiate transportation expenses, specific information and documentation must be gathered. This includes the exact dates of travel, the clear purpose of the trip (e.g., a doctor’s appointment, hospital visit, or prescription pickup), and the destination (such as the name of the medical provider or pharmacy). For personal vehicle use, a detailed mileage log is essential, noting the date, starting and ending odometer readings or total miles driven, and the medical purpose of each trip.

Receipts are necessary for public transportation fares, tolls, parking fees, ambulance services, airfare, and lodging. These receipts should clearly show the amount paid and the service or item purchased. Retaining any relevant medical documentation, such as appointment confirmations or doctor’s notes, can further support the necessity of the travel in case of an audit.

Various methods can be used for record-keeping, including digital applications, spreadsheets, or physical folders. Consistency and detail are crucial to ensure all necessary information is readily available. The goal is to create a clear audit trail that directly links the transportation expense to a qualified medical purpose.

Using Your HSA for Qualified Transportation

After understanding qualified medical transportation expenses and gathering documentation, you can utilize your HSA funds. There are generally two primary methods for accessing your HSA funds for these expenses: direct payment and reimbursement.

Direct payment involves using an HSA debit card, if provided by your administrator, at the point of sale. This can cover immediate expenses like public transport tickets, parking meters, or fuel directly related to a medical trip, assuming the administrator allows such direct use for fuel.

Reimbursement is a common method, especially for mileage or expenses paid initially by the individual. With this approach, you pay for the qualified transportation expense out-of-pocket and then submit a claim to your HSA administrator. This typically involves logging into your HSA account online or completing a reimbursement form.

When submitting a reimbursement claim, provide the expense type, date, and amount. You will attest the expense is qualified and retain all supporting documentation. The administrator will then process the claim and transfer the funds from your HSA to your linked bank account. Distributions from an HSA for qualified medical expenses are tax-free. Consult your specific HSA administrator for their exact procedures and requirements, as processes can vary.