Rollover of current employers Optum bank HSA to Fidelity

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Topic Author
panhead
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Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

Hi All,

I'm considering rolling some of my funds from my current employers Optum bank HSA to my fidelity HSA. I'll leave enough in Optum to keep the account open and avoid monthly fees, as I still want my payroll deductions going here.
Optum has the line below in their fee statement concerning rollovers or transfers for my HSA:

$20.00 per Outbound Transfer or Rollover to another HSA Custodian.

I've read several threads about the indirect rollover to avoid fees, and this is what I was considering doing, but it appears they will try to apply the fee whether I do a trustee to trustee transfer or a rollover.

Now, I've read several methods about how people are trying to do this, some specific to Optum:

1) Use checks from your HSA provider and send them to fidelity with the deposit slip indicating 60 day rollover
2) Use "reimburse yourself" from Optums website to initiate an ACH transfer to your checking account then write a personal check to fidelity using deposit slip and indicating 60 day rollover
3) Call your HSA provider and have them send you a check made out to you, deposit check in your bank then write a personal check to fidelity using the deposit slip and indicating a 60 day rollover

Concerning Optum specifically, has anyone done any of the above and avoided the outbound fee? If I use the ACH transfer method they would never know what I used the funds for anyway?

From what I understand the outgoing provider doesn't need to code anything that matters, and any of these methods should be coded as a "normal" distribution. All that matters is that the incoming institution codes the transaction properly, ie 60 day rollover.

I don't want to do this and find out that I'm getting hit with taxes and a 20% penalty cause I screwed something up.
ExPatKiwi
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by ExPatKiwi »

I'm in the same boat so I'd be interested how to do the same to get funds from my Sentinel Benefits HS to Fidelity without penalty.
Counting down to retirement on December 31st, 2024
Cactuscoug
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by Cactuscoug »

We rolled from Optum to Fidelity, and Fidelity reimbursed the $20 fees.
spitty
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by spitty »

I did an ACH transfer from Optum in 2017 (about $75k) to my bank account then immediately on to a new Lively account. No questions asked and no fees. You have 2 months to fund the new account and can do it this way only once per year. And the IRS must be notified via form 8889. I'm assuming the rules haven't changed.
Topic Author
panhead
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

Cactuscoug wrote: Mon Jan 06, 2020 8:14 am We rolled from Optum to Fidelity, and Fidelity reimbursed the $20 fees.
This is very interesting. I need to call fidelity before I do this transaction anyway. How long ago did you do this?
Topic Author
panhead
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

spitty wrote: Mon Jan 06, 2020 8:17 am I did an ACH transfer from Optum in 2017 (about $75k) to my bank account then immediately on to a new Lively account. No questions asked and no fees. You have 2 months to fund the new account and can do it this way only once per year. And the IRS must be notified via form 8889. I'm assuming the rules haven't changed.
Hi Spitty, when you did the ACH transfer, did you initiate it on their website (reimburse myself button) or did you call them?
lkar
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by lkar »

I did an optum to fidelity HSA rollover. Tried to, anyway. I called Optum and they mailed me a check. I then did an etf transfer from my bank account to fidelity.

This was the wrong way to do it. I am pretty sure I called and they told me it was ok, but there is no means of initiating the transfer and identifying it as a rollover contribution, apparently.

Use the form. Check the correct box. Make a copy!
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SteelyEyed
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by SteelyEyed »

We have an Optum HSA through an employer and a standalone Fidelity HSA.

We use 2) "reimburse yourself." The funds go straight to our checking account. There are no transfer fees (that would be atrocious for people who reimburse themselves monthly for actual expenses). We take the account to $0 once per year, though there are no minimums / monthly fees for us.
spitty
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by spitty »

when you did the ACH transfer, did you initiate it on their website (reimburse myself button) or did you call them
Panhead--I did it via their website with just a few clicks. Hopefully your employer wouldn't block you from doing it this way; I was self employed and had no "rules". At least try it!
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UpsetRaptor
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by UpsetRaptor »

SteelyEyed wrote: Mon Jan 06, 2020 10:21 am We have an Optum HSA through an employer and a standalone Fidelity HSA.

We use 2) "reimburse yourself." The funds go straight to our checking account. There are no transfer fees (that would be atrocious for people who reimburse themselves monthly for actual expenses). We take the account to $0 once per year, though there are no minimums / monthly fees for us.
Then how did you get the funds to Fidelity? Filled out the form as a rollover and mailed with check? Seems like Fidelity has no way to handle this type of rollover electronically, correct me if I'm wrong?
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SteelyEyed
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by SteelyEyed »

UpsetRaptor wrote: Mon Jan 06, 2020 11:17 am
SteelyEyed wrote: Mon Jan 06, 2020 10:21 am
Then how did you get the funds to Fidelity? Filled out the form as a rollover and mailed with check? Seems like Fidelity has no way to handle this type of rollover electronically, correct me if I'm wrong?
Correct, there is no way to do that part online. We mailed a check with a deposit slip. On the deposit slip, check the "60 day rollover" box.
Topic Author
panhead
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

lkar wrote: Mon Jan 06, 2020 9:53 am I did an optum to fidelity HSA rollover. Tried to, anyway. I called Optum and they mailed me a check. I then did an etf transfer from my bank account to fidelity.

This was the wrong way to do it. I am pretty sure I called and they told me it was ok, but there is no means of initiating the transfer and identifying it as a rollover contribution, apparently.

Use the form. Check the correct box. Make a copy!
Thanks for the response, I think I read about your issue in another thread. I'm pretty clear that the final step needs to be sending a check with the deposit slip indicating 60 day rollover. I hope your situation works out.
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panhead
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

SteelyEyed wrote: Mon Jan 06, 2020 10:21 am We have an Optum HSA through an employer and a standalone Fidelity HSA.

We use 2) "reimburse yourself." The funds go straight to our checking account. There are no transfer fees (that would be atrocious for people who reimburse themselves monthly for actual expenses). We take the account to $0 once per year, though there are no minimums / monthly fees for us.
This is the way I would like to do it as it seems the easiest. I'm connecting my checking account as we speak. I've also ordered checks from Optum since apparently they are free. When is the first time you did it this way? What convinced you that this an acceptable way to do this? Did you get the 1099sa correctly coded from from fidelity? Also, did you get the other form around May (5598?)

Thanks!
Last edited by panhead on Mon Jan 06, 2020 8:31 pm, edited 1 time in total.
Topic Author
panhead
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

spitty wrote: Mon Jan 06, 2020 11:00 am
when you did the ACH transfer, did you initiate it on their website (reimburse myself button) or did you call them
Panhead--I did it via their website with just a few clicks. Hopefully your employer wouldn't block you from doing it this way; I was self employed and had no "rules". At least try it!
Sounds like you did the "reimburse yourself" method? You've had no issues with this? What convinces you this was an acceptable way to do this? I assume you got the 1099sa which was coded correctly?

Thanks for the response!
lkar
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by lkar »

panhead wrote: Mon Jan 06, 2020 8:27 pm
lkar wrote: Mon Jan 06, 2020 9:53 am I did an optum to fidelity HSA rollover. Tried to, anyway. I called Optum and they mailed me a check. I then did an etf transfer from my bank account to fidelity.

This was the wrong way to do it. I am pretty sure I called and they told me it was ok, but there is no means of initiating the transfer and identifying it as a rollover contribution, apparently.

Use the form. Check the correct box. Make a copy!
Thanks for the response, I think I read about your issue in another thread. I'm pretty clear that the final step needs to be sending a check with the deposit slip indicating 60 day rollover. I hope your situation works out.
Thanks. Yep, Fidelity corrected it for me. All good.
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SteelyEyed
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by SteelyEyed »

panhead wrote: Mon Jan 06, 2020 8:29 pm
SteelyEyed wrote: Mon Jan 06, 2020 10:21 am
This is the way I would like to do it as it seems the easiest. I'm connecting my checking account as we speak. I've also ordered checks from Optum since apparently they are free. When is the first time you did it this way? What convinced you that this an acceptable way to do this? Did you get the 1099sa correctly coded from from fidelity? Also, did you get the other form around May (5598?)

Thanks!
The first time was January 2019. I read about it here and I chatted with a Fidelity CSR. I have a few days until the 365 day clock expires (you can only do this once every 365 days), and then I will do it again. Both 2019 forms are already available to me online.
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panhead
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

SteelyEyed wrote: Mon Jan 06, 2020 9:31 pm
panhead wrote: Mon Jan 06, 2020 8:29 pm
SteelyEyed wrote: Mon Jan 06, 2020 10:21 am
This is the way I would like to do it as it seems the easiest. I'm connecting my checking account as we speak. I've also ordered checks from Optum since apparently they are free. When is the first time you did it this way? What convinced you that this an acceptable way to do this? Did you get the 1099sa correctly coded from from fidelity? Also, did you get the other form around May (5598?)

Thanks!
The first time was January 2019. I read about it here and I chatted with a Fidelity CSR. I have a few days until the 365 day clock expires (you can only do this once every 365 days), and then I will do it again. Both 2019 forms are already available to me online.
Thanks Steely, I've been doing some reading and pretty much any method of getting money out of an HSA seems legit as long as it gets coded as normal distribution which it should. The more important part is definitely getting the 60 day rollover coded properly. I'm convinced, I'll be doing it through the "reimburse yourself" method and the fidelity deposit slip this year.

Thanks everybody for the responses!
cas
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by cas »

panhead wrote: Mon Jan 06, 2020 10:16 pm I'm convinced, I'll be doing it through the "reimburse yourself" method and the fidelity deposit slip this year.
One big thing to watch out for is that if you do the "reimburse yourself" you have to make sure to get the entire amount you want withdrawn all in one withdrawal. It can't be in multiple withdrawals because some currently-unknown Optum bank policy suddenly kicks in to start limiting the dollars-per-day you can withdraw via ACH.

Here is an example where someone with an HSA Bank account (attempting a 60 day rollover to Fidelity) almost got themselves in severe trouble with this kind of situation, earning themselves this comment from SpiritRider:

reasons to avoid indirect HSA rollover? (I linked directly to the SpiritRider comment, but you'll want to scroll up in that thread and read how it came about as well.)
Spirit Rider wrote: Tue Dec 11, 2018 6:07 pm I hate to be the bearer of extremely bad news. Only the first distribution amount of $2,500 is eligible for tax-free rollover. All the other distributions that exceed your unreimbursed qualified medical expenses are non-qualified distributions, subject to ordinary taxes and if < age 65, subject to a 20% excise tax penalty, are not eligible for rollover and constitute excess contributions if not removed.
Note that this was entirely due to HSA Bank policies limiting how much could be withdrawn per day via certain methods. Optum Bank may cause you no problems whatsoever. In fact, someone upthread said that that they pulled large amounts from Optum Bank to their linked checking account with no problem.

But I'm a little concerned that you said upthread that you are just now setting up the link to your checking account. You haven't said how much you are hoping to "reimburse yourself" then send on to Fidelity. But if it is a large amount, it is possible that Optum may have some sort of fraud-suspicion delay kick in while they investigate whether it is legit that a large amount is being ACH-ed over to a just-linked checking account. Just be alert for anything odd that seems to be going on with the ACH ... taking too long, etc. Contact Optum at that point and see what it going on. Don't try to fix it yourself by assuming that the first ACH request didn't work, intiating a second one, etc.

In all likelihood, everything will be fine. (I have zero knowledge what Optum's policies on these types of things are.) Don't want to scare you unnecessarily ... but ... it also seemed like you might want to be alerted to the rather dire problems that can occur if "reimburse yourself" somehow ends up pulling the full amount in multiple chunks.
Last edited by cas on Tue Jan 07, 2020 8:19 am, edited 1 time in total.
Topic Author
panhead
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

cas wrote: Tue Jan 07, 2020 7:42 am
panhead wrote: Mon Jan 06, 2020 10:16 pm I'm convinced, I'll be doing it through the "reimburse yourself" method and the fidelity deposit slip this year.
One big thing to watch out for is that if you do the "reimburse yourself" you have to make sure to get the entire amount you want withdrawn all in one withdrawal. It can't be in multiple withdrawals because some currently-unknown Optum bank policy suddenly kicks in to start limiting the dollars-per-day you can withdraw via ACH.

Here is an example where someone with an HSA Bank account (attempting a 60 day rollover to Fidelity) almost got themselves in severe trouble with this kind of situation, earning themselves this comment from SpiritRider:

reasons to avoid indirect HSA rollover? (I linked directly to the SpiritRider comment, but you'll want to scroll up in that thread and read how it came about as well.)
Spirit Rider wrote: Tue Dec 11, 2018 6:07 pm I hate to be the bearer of extremely bad news. Only the first distribution amount of $2,500 is eligible for tax-free rollover. All the other distributions that exceed your unreimbursed qualified medical expenses are non-qualified distributions, subject to ordinary taxes and if < age 65, subject to a 20% excise tax penalty, are not eligible for rollover and constitute excess contributions if not removed.
Note that this was entirely due to HSA Bank policies limiting how much could be withdrawn per day via certain methods. Optum Bank may cause you no problems whatsoever. In fact, someone upstream said that that they pulled large amounts from Optum Bank to their linked checking account with no problem.

But I'm a little concerned that you said upthread that you are just now setting up the link to your checking account. You haven't said how much you are hoping to "reimburse yourself" then send on to Fidelity. But if it is a large amount, it is possible that Optum may have some sort of fraud-suspicion delay kick in while they investigate whether it is legit that a large amount is being ACH-ed over to a just-linked checking account. Just be alert for anything odd that seems to be going on with the ACH ... taking too long, etc. Contact Optum at that point and see what it going on. Don't try to fix it yourself by assuming that the first ACH request didn't work, intiating a second one, etc.

In all likelihood, everything will be fine. (I have zero knowledge what Optum's policies on these types of things are.) Don't want to scare you unnecessarily ... but ... it also seemed like you might want to be alerted to the rather dire problems that can occur if "reimburse yourself" somehow ends up pulling the full amount in multiple chunks.
cas, thank you so much! I've read that thread and in general always pay attention to things that spirit rider posts. Very good advice and certainly a good cautionary tale. The amount I'm looking at withdrawing is currently small since its a brand new HSA (<$3000). Hopefully I won't run into any strange snags but should I, I will stop and contact Optum immediately. I'll update this thread with my experience as well so we at least have one more data point.
Thanks again!
lkar
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by lkar »

Just to be clear, does the prohibition on rolling over more than one distribution only apply to distributions in excess of medical expenses or does a distribution for medical expenses disqualify you from a rollover for 12 months?

Example: $5,000 in HSA. Jan. 15: Incur $250 medical expense. Jan. 30: Take $250 distribution to reimburse yourself for medical expense. March 1: Take distribution of remaining $4750 and roll it over.
cas
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by cas »

lkar wrote: Tue Jan 07, 2020 9:18 am Just to be clear, does the prohibition on rolling over more than one distribution only apply to distributions in excess of medical expenses or does a distribution for medical expenses disqualify you from a rollover for 12 months?

Example: $5,000 in HSA. Jan. 15: Incur $250 medical expense. Jan. 30: Take $250 distribution to reimburse yourself for medical expense. March 1: Take distribution of remaining $4750 and roll it over.
The way I understand it, your above example would be fine. But SpiritRider is the expert, not me. And they had a good ol' roiling debate over on that other thread about what exactly the words in various IRS publications really meant. I didn't re-read that debate before I wrote this. So I could be way wrong.

But, as I understand it, what would NOT be fine is:

Jan 30: Take $2500 distribution (because, for example, your HSA custodian lets you take a max of $2500 out via ACH per day). Reimburse yourself $250.
Jan 31: Take the other $2500 out.

March 1: Try to roll over the $4750. ($ (2500- $250) + $2500).
The $2250 from the first distribution would count as Rollover #1.
The $2500 from the second distribution would count as Rollover #2, invalid because it occurred before 365 days had passed after Rollover #1.

The whole debate over on that other thread had to do with whether you counted the 365 days from the date of withdrawal from custodian #1 or the date of deposit to custodian #2.
lkar
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by lkar »

cas wrote: Tue Jan 07, 2020 9:48 am
lkar wrote: Tue Jan 07, 2020 9:18 am Just to be clear, does the prohibition on rolling over more than one distribution only apply to distributions in excess of medical expenses or does a distribution for medical expenses disqualify you from a rollover for 12 months?

Example: $5,000 in HSA. Jan. 15: Incur $250 medical expense. Jan. 30: Take $250 distribution to reimburse yourself for medical expense. March 1: Take distribution of remaining $4750 and roll it over.
The way I understand it, your above example would be fine. But SpiritRider is the expert, not me. And they had a good ol' roiling debate over on that other thread about what exactly the words in various IRS publications really meant. I didn't re-read that debate before I wrote this. So I could be way wrong.

But, as I understand it, what would NOT be fine is:

Jan 30: Take $2500 distribution (because, for example, your HSA custodian lets you take a max of $2500 out via ACH per day). Reimburse yourself $250.
Jan 31: Take the other $2500 out.

March 1: Try to roll over the $4750. ($ (2500- $250) + $2500).
The $2250 from the first distribution would count as Rollover #1.
The $2500 from the second distribution would count as Rollover #2, invalid because it occurred before 365 days had passed after Rollover #1.

The whole debate over on that other thread had to do with whether you counted the 365 days from the date of withdrawal from custodian #1 or the date of deposit to custodian #2.
Interesting. That all makes sense.

I hope that is the rule, because otherwise it would mean that any reimbursement for medical expenses would prevent a rollover for a year. Seems harsh, but I find that often IRS rules just are what they are and you can’t get too focused on trying to determine intent.

I guess many boggleheads just use their HSAs as retirement vehicles so they aren’t taking distributions for expenses but this would be a trap for the unwary.
cas
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by cas »

lkar wrote: Tue Jan 07, 2020 9:55 am Interesting. That all makes sense.

I hope that is the rule, because otherwise it would mean that any reimbursement for medical expenses would prevent a rollover for a year. Seems harsh, but I find that often IRS rules just are what they are and you can’t get too focused on trying to determine intent.

I guess many boggleheads just use their HSAs as retirement vehicles so they aren’t taking distributions for expenses but this would be a trap for the unwary.
Upon further reflection, I got myself completely confused.

The issue is that you specify on tax forms only that there was a medical reimbursement, not which withdrawal it went with.

As long as IRS rules, during an audit, let the tax payer chose which withdrawal it went with to best suit their circumstances, all is well in your example. For example...

- In your example, $250 + $4750 withdrawal, you want the $250 medical expense to go with the first withdrawal.

- In my second example, the best outcome would be if the tax payer could say that the $250 medical expense went with the *second* $2500 withdrawal. Then $2500 of the rollover (from the first withdrawal) is valid and only $2250 from the second withdrawal is invalid (as opposed to the whole $2500 from the second withdrawal being invalid.)

If IRS doesn't let the taxpayer chose, then, as you say, that ends up being an awfully big trap that would cause all sorts of completely innocent dire errors. I would hope it wouldn't be this way.

But, I don't know IRS rules well enough to say definitively which way it is. That would be a question for SpiritRider or Alan S.
Spirit Rider
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by Spirit Rider »

The IRS does not control this. Indirect rollovers are a normal distribution followed by an rollover contribution. This normal distribution is no different than any normal distribution to reimburse for qualified distributions.

The taxpayer will receive a single 1099-SA with a total of all distributions. The taxpayer uses tax software and/or Form 8889 to report which amounts of those distributions are; a rollover, for qualified medical expenses or non-qualified.

It only becomes a problem if you mistakenly do more than one indirect rollover in a 12 month period. The added rollover(s) become excess contributions that need to be removed and if > any qualified medical expenses would be non-qualified distributions.
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panhead
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

Spirit Rider wrote: Tue Jan 07, 2020 10:40 am The IRS does not control this. Indirect rollovers are a normal distribution followed by an rollover contribution. This normal distribution is no different than any normal distribution to reimburse for qualified distributions.

The taxpayer will receive a single 1099-SA with a total of all distributions. The taxpayer uses tax software and/or Form 8889 to report which amounts of those distributions are; a rollover, for qualified medical expenses or non-qualified.

It only becomes a problem if you mistakenly do more than one indirect rollover in a 12 month period. The added rollover(s) become excess contributions that need to be removed and if > any qualified medical expenses would be non-qualified distributions.
Thanks Spirit Rider, I was hoping you would chime in.
So, I think I get it. Form 8889 makes a lot of this quite clear. If you are doing an indirect rollover you can only have 1 distribution per rolling 12 month period for this and the receiving institution needs to code it as a 60 day rollover. You can have as many distributions as you wish beyond this for qualified medical expenses. The total of the distributions for qualified medical expenses + the amount of the single rollover distribution must equal your total distributions for the year. If they do, you are good to go. If not, you will likely owe taxes and penalty on the difference.

The above only applies to normal distributions (code 1) as there are different rules for the other codes, though these are not my concern in this thread.

Do I have this right?
Spirit Rider
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by Spirit Rider »

Yes, you have a good understanding.
Topic Author
panhead
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

I finally got around to rolling over my current employer HSA with Optum to Fidelity so I wanted to update this thread in case anyone is trying to do the same

I had planned on doing the rollover one of two ways:

1) Use the "reimburse myself" button on the Optum screen to move the amount I wanted to rollover to my bank account, then writing a personal check, filling out the fidelity deposit slip indicating a 60 day rollover and mailing it in.
2) Use the checks I got from Optum and simply fill it out with the amount I wanted to roll over and mail it in with the same deposit slip indicating the 60 day rollover

As it turns out, the checks can only be used to a maximum amount of $5,000. I had procrastinated long enough in doing the rollover that the amount was now greater than this, so that was out.

So, I used the "reimburse myself" button to move the money to my checking account. Note I had already jumped thru the hoops of linking my personal bank account to Optum.

This worked. Once the transfer cleared in my checking account, I filled out the fidelity deposit slip indicating a 60 day rollover, along with my HSA account number, enclosed a personal check for the amount that I pulled out of the HSA and mailed it first class to Fidelity. A few days later, the deposit showed up as a rollover. Very easy.

So long as the paperwork gets coded correctly for tax time (which I can't see how it wouldn't) I am all set. I will do this again in 365+a few days.

The last step I believe is filling out form 8889 correctly during tax time, which appears trivial.

Thanks for all those who responded on this thread, I'll update after April 2022 if I run into any issues with taxes.
tenkuky
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by tenkuky »

panhead wrote: Tue Jul 20, 2021 6:04 am I finally got around to rolling over my current employer HSA with Optum to Fidelity so I wanted to update this thread in case anyone is trying to do the same
Once the transfer cleared in my checking account, I filled out the fidelity deposit slip indicating a 60 day rollover, along with my HSA account number, enclosed a personal check for the amount that I pulled out of the HSA and mailed it first class to Fidelity. A few days later, the deposit showed up as a rollover.
Next time theres a quicker, easier way for the last part (done 3 years in a row with HealthEquity).
If your Fido HSA is linked with your bank acct, you can call Fido and they will initiate a Ach rollover coded transfer to the Fido HSA (cant do online yourself).
No mailing, funds there next day.
dcabler
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Re: Rollover of current employers Optum bank HSA to Fidelity

Post by dcabler »

panhead wrote: Tue Jul 20, 2021 6:04 am I finally got around to rolling over my current employer HSA with Optum to Fidelity so I wanted to update this thread in case anyone is trying to do the same

I had planned on doing the rollover one of two ways:

1) Use the "reimburse myself" button on the Optum screen to move the amount I wanted to rollover to my bank account, then writing a personal check, filling out the fidelity deposit slip indicating a 60 day rollover and mailing it in.
2) Use the checks I got from Optum and simply fill it out with the amount I wanted to roll over and mail it in with the same deposit slip indicating the 60 day rollover

As it turns out, the checks can only be used to a maximum amount of $5,000. I had procrastinated long enough in doing the rollover that the amount was now greater than this, so that was out.

So, I used the "reimburse myself" button to move the money to my checking account. Note I had already jumped thru the hoops of linking my personal bank account to Optum.

This worked. Once the transfer cleared in my checking account, I filled out the fidelity deposit slip indicating a 60 day rollover, along with my HSA account number, enclosed a personal check for the amount that I pulled out of the HSA and mailed it first class to Fidelity. A few days later, the deposit showed up as a rollover. Very easy.

So long as the paperwork gets coded correctly for tax time (which I can't see how it wouldn't) I am all set. I will do this again in 365+a few days.

The last step I believe is filling out form 8889 correctly during tax time, which appears trivial.

Thanks for all those who responded on this thread, I'll update after April 2022 if I run into any issues with taxes.
Are you not able to do a direct custodian to custodian transfer from Optum to Fidelity? I do this with HealthEquity. You can do this by initiating it on the Fidelity side and they'll take care of the rest. For HealthEquity, I also have the option of initiating the transfer from their side.

Cheers.
Topic Author
panhead
Posts: 470
Joined: Fri Feb 22, 2013 10:53 am

Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

tenkuky wrote: Tue Jul 20, 2021 6:15 am
panhead wrote: Tue Jul 20, 2021 6:04 am I finally got around to rolling over my current employer HSA with Optum to Fidelity so I wanted to update this thread in case anyone is trying to do the same
Once the transfer cleared in my checking account, I filled out the fidelity deposit slip indicating a 60 day rollover, along with my HSA account number, enclosed a personal check for the amount that I pulled out of the HSA and mailed it first class to Fidelity. A few days later, the deposit showed up as a rollover.
Next time theres a quicker, easier way for the last part (done 3 years in a row with HealthEquity).
If your Fido HSA is linked with your bank acct, you can call Fido and they will initiate a Ach rollover coded transfer to the Fido HSA (cant do online yourself).
No mailing, funds there next day.

Thanks tenkuky, this is good information. My Fido HSA isn't currently linked to my bank account, but I will set this up. The snail mail check wasn't a big deal and didn't take very long, but I'd rather avoid it. That being said, my phone wait time for a Fido rep has seemed to substantially increased in the last year or so.....
Topic Author
panhead
Posts: 470
Joined: Fri Feb 22, 2013 10:53 am

Re: Rollover of current employers Optum bank HSA to Fidelity

Post by panhead »

dcabler wrote: Tue Jul 20, 2021 6:18 am Are you not able to do a direct custodian to custodian transfer from Optum to Fidelity? I do this with HealthEquity. You can do this by initiating it on the Fidelity side and they'll take care of the rest. For HealthEquity, I also have the option of initiating the transfer from their side.
Cheers.
Hi dcabler,

Yes, I can do a direct (custodian to custodian) rollover, however Optum charges $25 for this service. Its certainly not a large sum, but this process avoided it completely. I've also heard that in some cases Fido will reimburse the fee charged by the outgoing provider, but I didn't investigate this. Its really a very simple process (the indirect rollover), although one has to pay attention during tax time to fill out the form correctly, and this is only allowed once every rolling 1 year period.
dcabler
Posts: 1931
Joined: Wed Feb 19, 2014 11:30 am

Re: Rollover of current employers Optum bank HSA to Fidelity

Post by dcabler »

panhead wrote: Wed Jul 21, 2021 5:44 am
dcabler wrote: Tue Jul 20, 2021 6:18 am Are you not able to do a direct custodian to custodian transfer from Optum to Fidelity? I do this with HealthEquity. You can do this by initiating it on the Fidelity side and they'll take care of the rest. For HealthEquity, I also have the option of initiating the transfer from their side.
Cheers.
Hi dcabler,

Yes, I can do a direct (custodian to custodian) rollover, however Optum charges $25 for this service. Its certainly not a large sum, but this process avoided it completely. I've also heard that in some cases Fido will reimburse the fee charged by the outgoing provider, but I didn't investigate this. Its really a very simple process (the indirect rollover), although one has to pay attention during tax time to fill out the form correctly, and this is only allowed once every rolling 1 year period.
Ouch. Yeah, I could see why you would want to avoid that. I seem to recall that Fido was doing reimbursements when they first opened up HSA's to the general public, but I don't know if they still do it. Best of luck!
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