![]() I will be adding more features to it in the future, but it can serve as a tool for helping you maintain your HSA records and audit proof yourself in case the IRS comes knocking. Overall, this is a simple system for managing your HSA spending and receipts. You can also download it in its original form for your records later on. ![]() When you click on that transaction for more detail, the image is displayed so you can reference it. Once uploaded, the camera icon on the summary screen becomes a green checkbox indicating that the transaction has a receipt. Uploading is simple and the image is stored securely to your account, and no one else has visibility to it. This is a best practice because it confirms that the transaction occurred, especially in the eyes of the IRS. When creating the transaction, you can optionally upload an image of the receipt. Only 3 fields are required so you can quickly create purchases and come back and add more information later. This information comes in useful when you need to reimburse prior purchases or determine if a transaction was HSA eligible. You can record detailed information about the purchase, including the provider, description, amount paid, amount reimbursed (important!), HSA category, payment method, and free form notes. On the right, you can enter a new purchase and categorize it. When you login you can see a summary of your HSA activity. Whenever I make a qualified medical expense, I log it in TrackHSA. Delaying reimbursement is a great strategy to let your tax advantaged HSA account grow, and TrackHSA helps you justify the reimbursement when you do so down the line. By tracking the actual HSA transaction, you can not only upload the receipt to justify the expense to the IRS should they audit you, you can track whether or not that purchase has been reimbursed. TrackHSA fixes this by providing context to your HSA from the transaction perspective, putting the focus on uses of your HSA for qualified medical expenses. Without context, you will not know if that $200 was for a purchase (no receipt), a prior reimbursement (no transaction context), or an unqualified withdrawal (no notes). For example, say you withdrew $200 from your HSA last month. While your HSA bank account can tell you the amounts that go in and out of the account, it does not characterize those transactions in relation to an HSA. TrackHSA functions as a both a listing and calculator for your HSA activity. So I set out to build TrackHSA, and that is what I did. I didn’t want to run the risk of it getting lost / deleted, and I needed it to be secure and able to do the work for me. Given all of the manual storage (and risk) you can read about in my old system below, I needed an online software that tracked and stored all of my HSA transactions and receipts. Keeping appropriate records for your Health Savings Account is easy with dedicated software. I also back up this same information on my external hard drive but this is prone to fail. In theory, this is a fail safe and secure way of backing up your HSA receipts. I have written TrackHSA just for this application, but you could also use Dropbox or Google Drive to backup any and all information on offsite, secure servers. Luckily, there are simple cloud-based solutions that can help retain your records. This is part of the strategy of using your HSA as an ATM. For example, if I pay for QME out of pocket at age 25, I may not need to reimburse myself – depending on my financial condition – for that expense until I am 55. This especially applies if you are young and saving for the long haul. Depending on your age, you could have 40+ years until you need to provide proof of spending. The major complication with an HSA is the length of time between contribution, spending and reimbursement. This ensures you never pay too much in tax while knowing how much you can pull from your HSA, tax-free, in the event of an emergency. Perhaps more importantly, this system allows you to track your unreimbursed qualified medical expenses. If – God forbid – you are ever audited by the IRS, you will already have all relevant information at hand. Due to its tax advantaged nature, your HSA has implications for your income taxes, so it is important to keep proper records. There are a number of reasons to setup a simple, organized system for maintaining your health savings account records. Track purchases, upload receipts, and record reimbursements for all HSA purchases to help you minimize your taxes and satisfy the IRS. Update: Unhappy with my previous record keeping attempts, I created an online software called TrackHSA, a service to help manage your Health Savings Account.
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