15 Reasons Why the HSA is the Secret to Supercharging Your Wealth

Thank you for being here today. We're going to have a great day and I'm going to give you 15 reasons why the Health Savings Account is the best kept tax secret in America. Yeah, it's crazy. Health Savings Account, if you've got one, I'm going to give you 15 reasons why you're kicking ass. If you don't have one. These are 15 reasons why you might get your ass in gear. So we're going to have a good time here. Hope to take on some questions and please, please, whatever platform you're watching on YouTube, Instagram, LinkedIn, Facebook, whatever, type your question down below. I will be filling questions from multiple platforms. Let's rock and roll. 15 reasons why the health savings account should be a part of your master tax plan, wealth building plan and freaking medical savings plan. All right, number one, you get a tax deduction this year, 2024 of 3150 or $8300 for putting money into a health savings account. That's 3150 if you're single, 8300 if you're married or head of household with just some kids, single mom, single dad, 8300. That's on the front page of your tax return. And I want to say no matter what. Oh well, I'm going to come in on some other benefit. I'm just going to say this no matter what your income level is because I was going to Wonder if that's one of my 15, but I don't think it is. So no matter what your income level is, there's no phase out. You get a deduction on the front page of your tax return. Number two, whatever you put into that account grows tax free. Tax free, no tax. You get invested in crypto, bitcoin, real estate, stocks, bonds, mutual funds. You get to invest your health savings account. It is not a use it or lose it plan and it goes with you. It is. Number three, put portable. Your company may set up an HSA for you. You leave, you take it with you. You want to freaking take that money out right now, you can move it and take it with you. It is not like a 401k at work. That HSA is fully portable. You can open up an HSA somewhere else than the HSA you have at work. You entrepreneurs freaking A. You can control your HSA all you want. Number four, I love it. Rolls right into. You can self direct your 401k. You can invest it in alternative assets. My HSA owns an LLC that owns rental property that Rent goes into my HSA and comes out tax free for any medical expense. Crazy. We're only at number four now. Number five, it comes out tax free at any age. You can do this tomorrow at age 27 and pull out the money tomorrow. You can manufacture a write off, put the money in, write, reimburse yourself for medical tomorrow tax free at any age. You don't have to wait till you're 59 and a half. 60, 65, 70, does not matter. You can pull that money out at any time for a valid medical expense. We'll come into that. Number six, you can reimburse yourself. You heard me say that. So it's not like you have to put the money in and then go to the doctor and say use my HSA card. Here it is. Nope, just go to the freaking doctor, figure out how much you came out of pocket, you can go to your HSA and reimburse yourself. That's it. So it's not just put the money in now I got this pain in the ass way to do it. With a Visa card, you can reimburse yourself for medical expenses you incur later. Number seven, the last month rule. Now this is tricky. That's why we're going live today. If you set up your high deductible health care plan effective December 1st, so you've got about 10 days right now you can set up your high deductible plan. By the way, go to healthcare.gov go to your state exchange, you can do it within an hour. I've helped my kids do this, clients do this. You go to healthcare.gov and say, I need a health care plan by December 1st, it'll be effective frickin tomorrow. If it's effective by December 1st, you can take the write off for the entire 2024, even if you only had that plan effective by December 1st. And the cool part is, number eight, you can put the money in up until April 15th. So the number eight benefit is I can set it up now and put the money in by April 15th and I still get the write off for 2024. And once I put the money in, I can reimburse myself for an expense that I just had. Now what? Where's a pen? I need to do a pen drop. Bam. Okay, Now HS plans, HSA, healthcare plans, you have to have a high deductible plan to have an hsa. Now this is perfect for some of you that are like, Mark, I have health insurance, but I freaking don't even use it. Okay, so you've Got medical insurance you're not using. Get a high deductible plan, which holding all things constant with the current network you have, the premium should be lower because if you get the same network, the same plan, but it's high deductible, that means you're going to come out of pocket sooner. So the insurance company will say, oh, you can have a lower premium. Now if you go out there and get a killer network, you might pay more for that network. But holding all things constant, the high deductible plans have a lower premium. Number 10, benefit. If you don't use it for medical, it turns into an IRA at age 65. At age 65, you can pull it out just like a regular retirement account. You'll pay tax when you pull it out at age 65, but it turns into an IRA if you want it to. If not, you can keep pulling it out tax free for the medical for the rest of your life. Number 11, you do not have to have any earned income to fund an hsa. You can fund an HSA off investment income, off your W2, off your small business, off of whatever. It just comes off as a tax deduction on the front page of your tax return Schedule 1, as an HSA contribution, no matter what your income level is, no matter what type of income you have, you can freaking do it. Number 12, if you die, it goes into your spouse's health savings account or your kids as an IRA. So it turns into an Iraq with the 10 year distribution rule or it goes into your spouse's HSA. If you die, you will not lose this money. That's the beauty. It's not a use it or lose it. Number 13, I knew it was going to be here. No income limit. So anybody can participate in an hsa. Sometimes if you make too much money, you can't put money directly into a retirement account or other types of accounts. Or you phase out. Child tax credit phase out and solar tax credit phase out. You don't phase out freaking. You can make $10 million a year and still put money in your freaking HSA. Number 14, there's $1,000 makeup. So if you're between age 55 and 65, you get to put in an extra thousand dollars into your HSA. So instead of 3150 or 83, you get to put in 4150 or 93 extra thousand dollars. Now let me give you a pro tip and this is number 15 benefit. If you're married and you have a family plan and you're both 55. Split it into two independent plans so you can both put in a thousand. So now you get 2,000. See, if you have a family plan or a married plan, you could have put in 8300. If one of you is 55, I can put in an extra grand. So that takes it to 93. But if I have two independent plans and we're both 55 or older, now I can put a thousand in. Thousand in. Now I go from 8,300 to 10,300 tax deduction on the front page of my tax return. I can go buy freaking bitcoin with it and let it ride. You can buy real estate. You can buy a stock. You can. You can buy whatever and let it grow. Then next January, put in more money. I have clients with 100 grand in their HSA. I put cows, a farm in my HSA. I put rental property in my chase. I put a crypto mine in my hsa. People, you can do it. All my friends, those are 15 reasons why the Health Savings account is freaking amazing. They are incredible. To help you build wealth, get a tax deduction, cover your medical expenses, and be smart. Freaking game the system. Take on the freaking medical insurance industry and own it. It's your insurance now. You're in control. The Health Savings Account. Now I want to hit some questions. I'm your tax daddy, baby. Right here for you. What do we got, Dana?

Our first question is a pretty funny one from a longtime viewer with the recent sale of a banana taped to a wall for $6 million. Stay with me here. Can I use my HSA to sell something like a banana taped to a wall for $6 million?

I don't know if I understood the question. Can you say that?

Basically, I think what he's saying is, can I sell things in my hsa? Can I make money in my HSA with what's already in there?

If you have an hsa, your HSA could literally start a restaurant. Your HSA can buy stock. Your HSA could buy a rental property. Your HSA could buy a farm with cows and then make money for your hsa. Now, if it's operational income, you will pay what's called UBIT tax, unrelated business income tax. So your HSA will pay tax on its income if it starts a business, but if it invests in crypto or invests in stocks or invests in real estate, it will not pay taxes. It makes money. Does that answer the question?

I think so.

Okay. All right, next question on the hsa.

Next question. I just watched A different influencer. Talk about keeping all the receipts and taking reimbursements after 30 years and let it compound that entire time.

Correct. You can do that. Save your receipts. No one's. I don't know anybody that's going to do that. I freaking suck at it. But if you want to keep your hsa, keep building it and maybe for a couple years, and then reimburse yourself for a surgery you had yesterday, you can take that money out tax free. You go, girl. You're good. Next question.

Next question. If it doesn't need earned income, is it possible to open HSA for kids and contribute to it?

If the kids are a dependent of their parents, then they're part of the family plan. So your kids cannot open their own HSA until they are no longer a dependent of yours. So my children that are now 21 and older and they're living on their own, they. They open their own hsa. But if they're on my tax return as a dependent, they cannot open an hsa. They're part of my family plan, which means I can pull money out of my HSA for their medical expenses. Once my kids turn 21 and they go on their own plan, then my HSA cannot cover their medical because they're not a part of my plan. So there's going to be this point where you wave goodbye, see you. You're on your own hsa. My HSA is mine. You set up your own hsa. It's called leaving the nest. It's okay. Next question.

Is it one HSA per household, or can you set up one for yourself and a spouse?

If you set up husband and wife HSAs, which is fine. 3150. 3150. If you do a combined plan, 8306, half dozen. The other. The only reason why I would do two separate plans is once they turn 55. Now I can do an extra thousand and extra thousand because if you're married and you get divorced, you're going to split the plan anyway. Now, if one spouse wants to buy stock and the other one wants to buy crypto, you could open two independent plans, both put in 3150, and do in different investments. That could be another reason. But you don't get extra money if you do two plans and you're married.

All right, next question. Do you have to put in the 8300?

You don't have to put the money in. You may say, hey, Mark, now this is a good question. I'm going to open my high Deductible plan. I put five grand in my hsa. I'm single dad, and I put five grand in my hsa. Next year, tons of medical coming down the pipe, I go get a low deductible HMO plan. Do I lose my hsa? Nope. My five grand still sitting there is still growing, still investing, and I just get an HMO low deductible plan in 2025. Okay, cool. Oh, in 2026, I go get another high deductible plan. Okay, I'm back in. Now I can put more money back into my hsa. Oh, but I'm having a hard year. I'm only going to put two grand in. I could put an eight, but I'm only going to put in two. Okay, you can put up to the amount or less, but only in the year you have a high deductible plan. So when you have a high deductible plan, great. Put money in whatever you want up to the limit or nothing at all. Next year you don't have a high deductible plan, so the plan lives on. And then you get to put money in as you have a high deductible health insurance policy. That's how it works.

Another quick question. Does an HSA ever expire?

No, an HSA never expires. When you die, it goes to your spouse's HSA or to your kids as an ira, so they'll pay taxes. They pull the money out, just like a regular ira. If you're married, when you die, it goes into your spouse's health savings account and they can use it for medical until they die, and then it goes to the kids as an IRA never expires.

Can I transfer money from one HSA to another HSA?

Yes. So if you've got an HSA at work and your employer puts in 100 bucks a month, $1,200 is sitting there after last year. Take the $1,200, move it over to your other HSA and invest it the way you want. Now, keep in mind, let's say you got $3,150, you're single, the employer puts in $1,150 in your HSA. Let's say, then you go over here and open an HSA. Can you put in 3150? No, you get 3150 in total. So your employer put in 1150. You get to put in two grand because your total is 3150. So you have 1150 sitting here. You have two grand sitting here. Oh, I hate my employer and the way they invest my money. Grab it, put it over in this HSA and go invest it the way you want. You can have three HSAs. Thousand? Thousand. Eleven, fifty. Doesn't matter. It's just a 3150 in contribution this year.

Next question. I have an HSA that our company with our company with my company that treats it just like a savings account. The that she works for.

Yeah, it's like a savings account. That's good.

Can I take that money out and put it into an investment vehicle or can she self direct within her her works hsa?

Okay, this is a great question. So first name? Judy. Whatever. Okay, so Judy has an HSA at work. They put in two grand. All right? Now she has several options. She can turn in receipts and get that money out anytime for medical, tax free. She could take the 2000 and move it over to her own HSA and go invest it in crypto. Okay, the thing that she said is a little odd. She goes, I want to take it out and go do investments. You're going to get taxed and penalty because you didn't pull it out for medical. Well, I don't want to take it out, Mark. I just want to do my own investments that are better than what they offer at work. Okay, that's not taking it out. Call that a transfer. You're going to transfer it from this HSA to a HSA that's self directed. And when you go self direct an HSA you can invest in whatever the hell you want. So take it from this HSA to this one. Call that a transfer. Don't call it taking it out. I don't want you to take it out unless it's for medical. Now let me give you guys another pro tip. You can open up and an HSA in the next freaking hour. 300 bucks to open up an HSA for crypto. HSA you can do regular HSA and buy stocks. You could go self directed and buy real estate. You could roll other HSA money in. Go to and let's put it on the whiteboard. It is directed ira.com and just go to the new account, pull down menu new account and you're going to choose an HSA and you could put money in that hsa, be there in about two days. By the time you set it up and do transfers, you could be buying whatever the hell you want, investing it and growing it. There you go.

All right, let's get through some of these other ones. So my Spouse is starting an HSA in 2025 through a W2 job. Okay, excuse me, can I open and contribute to a separate HSA under my S corp if I'm covered under the spouse's insurance and HSA plan?

Okay, this is really good and there's some strategy here. So now we're going to go a little deeper because by the way, I have a tax advisor network. Main Street Tax Pro Advisor network. If you're an accountant, an enrolled agent, a cpa, and you're freaking loving this and you're like, holy crap, I don't learn this a regular ce. I want to be in a program where they teach awesome freaking CE and tribe and a community that's next level. Go to markjkohler.com, do a demo free and for my one of my friendly staff will show you our tax certification program so that you can be a kick ass tax advisor. Now in the chat I have tax advisors that follow me from all over the country. The speak Mark Kohler that are in chat right now. So if you're looking for a tax advisor, say, is anybody a tax advisor? I need a better accountant. One of my team members will say, yeah, come to a discovery call with me. I could be your guy or your gal, whatever. Now. So with that said, what was the question again?

My spouse has an HSA through.

Okay, we're going deep because we're going deep for my tax advice S corporation. All right, so in our trifecta, let's say you have an S corporation and we have husband and wife. All right, that was the question. She said, my husband has a day job, W2. Okay, husband's over here doing a W2. But then they have an S corp as well.

So he has an S corp. Oh,

he has an S corp. Okay, so he has an S corp. This is husband and. Husband and wife are down here. Here's the 1040 tax return. Now next year in 2025, they're going to get a high deductible health care plan. Okay, that's cool. Now they can do an HSA. So come January 1st, they want to put money in a health savings account. The first answer to your question is we always want the S corp to put the money in the hsa. Don't take the money and then you put in the hsa. Let the S corp do it. I'll explain why in a moment. Number two, you always want the S corp to pay the bill for the insurance. So let's say you got Blue Cross, Blue Shield, okay? That's cool. Do that. Let the S Corp pay it. And if you're like, mark, it's a personal plan. I don't care if it's a personal plan. Let the S Corp pay the premium. When you set it up on autopay, use the bank account for the S Corp. So now look what's happening. The S Corp is paying the premium and the S Corp is funding the hsa. Husband owns the S Corp. Wife may or may not be a W2. Doesn't matter. Wife. I don't care if you're a part owner or an employee, because you're married. You get to play in the game. So you said that you're like, I'm covered under this insurance policy. Can I fund this hsa? Damn straight. You're married. The S Corp pays the premium and the S Corp funds the HSA. And how much can you guys put in that? 8,300 in 2024. It'll probably be around 8,500 in. In 2025. Now here's what's cool. Your husband has to take reasonable comp. If you didn't think that was cool, it gets better. Okay? Husband has to take reasonable comp, right? Because you know S corps if you don't watch my YouTube videos on S corporations. So husband has to take a reasonable W2. But here's what's cool. Let's say you make 150 grand. Husband has to take a salary of 50 grand. That's what I would argue. And it's freaking right. So he's going to take a W2 for 50 grand. Then you're going to get a K1 for 100 grand. I just saved you right there, $15,000 in FICA. And if any of you accountants are freaking out, I have never had a client for taking too low and reasonable comp. I teach continuing education on reasonable comp. I'm a lawyer. I'm a cpa. I'm a member of the aicpa. I teach classes on this. I read every case on reasonable comp. This is fine. I interview IRS agents on my podcast, so get over it. You can be more aggressive with reasonable comp, and it's not an issue. Whoever's brainwashing you in this, it's. They're nuts. And I will stand behind this and sign this tax return all day long at 150k net profit. They can do reasonable comp of 50 all freaking day long. Now here's what's even better. Let's say the premium is 10 grand on the health Insurance. And then the reason and the HSA is 8,000. We're just going to round it down to 8,000. So what we do, this is box one, 50K, box three and box five. We're going to drop this down to $32,000. So the FICA wages are only on 32. Reasonable comp is based on box one. So now the IRS is happy we got nailed the M2, box seven, 50 grand and compensation for shareholders line seven 11 20s. One hundred and fifty without the payroll. We nailed it. Reasonable comp. But we're only paying FICA on 32. I just saved another 15% on 10,000. On $18,000. That's another 23, $2,400 in savings. That's a real tax advisor. If your tax advisor doesn't understand the W2 reasonable comp on an 1120s for an S corp to save to fund an HSA, you got the wrong tax advisor. All right, everybody, I got a roll. This was a quick 15 reasons why the Health Savings Account kicks ass. Look into it, learn about it. It's in my book, the Tax and Legal Playbook. Almost a thousand. Close to a 4.9 rating at 5 stars. 4.9 out of a thousand reviews. Amazon, people. I'm not going anywhere. The Tax Advisor Network is for real. The Health Savings Account is for real. And we can save money. We can build Main Street America. We can live the American dream. We can save taxes honestly and with ethics and properly and strategically. People, I love you. I'll be here not on Thanksgiving for another live, but the week after. I'll see you. Thanks so much.