For a limited time only, there are more options
Health Savings Accounts (HSAs) are a great tax vehicle for making the most of your medical expenses. However, it's not always easy to come up with the money to fund an HSA. Well, now there are more options available to HSA owners. At any time before 2012, you can make a one-time only tax-free rollover from an IRA to an HSA. This rollover amount may not be more than your HSA maximum contribution for your type of coverage, whether individual or family.
The transfer must be made via a direct trustee-to-trustee rollover. Because the rollover is tax-free, you won't receive a deduction for funding the HSA in this manner. Also, if you have a flex spending account (FSA) or a health reimbursement arrangement (HRA), you can make a one-time rollover into an HSA from one of these accounts. This tax-free rollover may not exceed the lesser of the balance in such an account on September 21, 2006, or on the date of the rollover distribution. Like the IRA rollover option, this rollover must also be completed via a trustee-to-trustee transfer. Talk to your tax preparer in deciding if one of these options is right for you.
