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Health Savings Account to Help Pay for Dental Work

Health Savings Account to Help Pay for Dental Work

Are you paying into a Health Savings Account (HSA), Medical Savings Account (MSA) or Flexible Spending Account (FSA) for medical expenses this year? People who do are able to set their money aside for health-related costs with no tax penalties. That’s right…when you’re paying into your HSA or FSA, you’re able to avoid income tax on the final dollar amount that you invested.

To be eligible for an HSA, you have to be part of a high deductible medical plan. Many times, those insurance plans don’t cover dental benefits. But what you do need to know is that you can use your HSA or FSA toward your dental bill!

Get a Tax Deductible on Your Dental Treatment

Ok, so it’s a bit of a stretch, but the money that you use to pay for your dental treatment — as long as it’s coming out of your HSA — is tax deductible. Just use your HSA card when you pay your dentist at the time of your treatment. It works like a debit or credit card, and the balance is withdrawn from your account.

If you’re on a fixed income or don’t have dental coverage, it can help to plan your treatment out in advance. HSAs are a great way for you to reduce your total out of pocket expenses at the end of the year, especially if you’re going to be getting dental treatment regardless.

A Supplement to Your Dental Insurance or Discount Dental Plan

You can even use your HSA or FSA benefits toward dental treatment if you have existing dental coverage. Let’s say that your insurance covers 50% of a crown, but you have a $100 deductible. Normally, you would have to pay $100 off the top of the crown total, and then 50% of the remaining balance. This money would come from your personal bank account. With an HSA, you can use your benefit card to pay for the out of pocket expenses before the insurance benefits kick in.

Or, if you’re part of a discount dental plan and are getting a set percentage taken off every treatment, you can use your HSA to pay the remaining portion.

How Much Treatment Will My HSA Cover?

Your benefits cover as much treatment as needed until you reach your maximum HSA balance. For individuals, the IRS allows you to contribute up to $3,300 of pre-tax income toward your HSA on an annual basis. Families can contribute up to $6,500 a year. If you’re a senior over the age of 55, you can add an extra $1,000 to your individual contribution, or a total of $4,300.

Health Savings Accounts differ from other types of medical or flex spending accounts, in that the benefits roll over each year. If you don’t use up all of your benefits this year, you can retain what’s left in your account and apply it toward medical or dental expenses during the next calendar year. With an FSA, that’s not the case…you actually lose the money that you don’t use!

So, what dental treatment does the money from an HSA actually cover? According to the IRS, the type of dental treatments that can be deducted fall under a clause under publication 502, that states:

You can include in medical expenses the amounts you pay for the prevention and alleviation of dental disease. Pre-treatment includes the services of a dental hygienist or dentist for such procedures as teeth cleaning, application of sealants, and fluoride treatments to prevent tooth decay. Treatment to alleviate dental disease include services of a dentist for procedures such as X-rays, fillings, braces, extractions, dentures, and other dental ailments.

Further down on the same document is a category that shows “What Expenses are Not Included” which lists elective procedures such as teeth whitening. As long as your benefits are going toward the restoration and treatment of problems like missing teeth, cavities, checkups, and orthodontics but not cosmetic procedures (like veneers or whitening,) you can usually plan on the funds being approved to cover your dental bill.

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