If you are a caregiver for another adult, their health care costs may be partially coming out of your pocket. However, if he or she is your tax dependent, you can use your own HSA to help cover their qualified expenses. First, determine whether the other adult qualifies as your tax dependent.
Does my adult dependent qualify as a tax dependent?
To qualify as a tax dependent, the Internal Revenue Service requires that the adult relative:
- Be your father, mother, father-in-law, mother-in-law, grandparent, aunt or uncle
- If the relative is not listed above, the person must have lived with the taxpayer for the entire year as a member of their household
- Have a gross income of less than $4,300 in 2023
- Have more than half their total financial support for the year coming from the person claiming them as a dependent
If the adult qualifies as your tax dependent, you can begin using your HSA to pay for their qualified expenses.
While the list of HSA-approved eligible expenses for your adult relative is identical to that of the HSA holder, there are some relevant eligible expenses for the elderly that family caregivers should be aware of:
- Home health care, such as assistance with eating, bathing and medication management
- Nursing home expenses
- Walkers, canes and wheelchairs
- Medical devices, like hearing aids and dentures
- Home improvements for the primary purpose of medical care, such as a ramp or widening doorways (Note: This will require a letter of medical necessity from a provider and other approvals to be eligible. Find out more information here.)