Use a Health Savings Account to Pay Medicare Premiums Tax-Free
Even when Part B premiums are deducted from your Social Security benefits, you can reimburse yourself from the HSA.
We have a sizable health savings account in my wife's name. She will turn 65 and go on Medicare in August 2016. I am 71, and my monthly Medicare Part B premium is deducted from my Social Security payment. Can we use money from her HSA to pay our Part B premiums, even though they're automatically deducted from my Social Security benefits? Can we also pay our Part D prescription-drug premiums from the HSA?
After your wife turns 65, you can use money from her HSA to pay Medicare premiums for both of you. And even though your premiums are deducted from your Social Security benefits, you can withdraw money from the HSA tax-free to reimburse yourselves for the Part B premiums. You can also use the HSA money to pay Part D premiums for both of you, as well as premiums for Medicare Advantage plans (but not medigap).
Keep in mind that your wife will no longer be able to make new contributions to her HSA after she signs up for Medicare.
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For more information about HSAs, see FAQs About Health Savings Accounts. Also, see IRS Publication 969, Health Savings Accounts.
