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Midstates Bank

FAQ

Bankability On Demand

Person-to-Person (P2P) Payment

Push Text Banking Alerts

Tag Transactions

Touch ID

Truncated Statements (Online Check Images)


 





 

Debit Card

 
 
 
I’m a new customer, when will my card get here?
The chip-enabled debit card should be at your address of record within 10 days, the PIN will follow shortly.  
 
What do I do if my card is broken or lost?
Notify us immediately by calling 1-866-546-8273 to report your debit card lost or stolen. To request a new card contact your local branch. 
 
My card expires this month, when will my new card arrive?

Your debit card will arrive by the end of the month, the PIN will remain the same. 

My card says "activate card," what does this mean?
To activate a card, you can do a PIN based inquiry at any ATM; it doesn’t have to be a Midstates Bank ATM. If you are unable to get to an ATM, contact your local branch and one of our customer service representative will be more than willing to assist you in your card activation.  Keep in mind your PIN is required for Person-to-Person (P2P) Payments on the Midstates Bank mobile app.

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Online Banking

 
 
 
How do I change my Midstates Online Identification Number to an easy username?
 
  1. Log in with your 6240 _ _ _ _ _ _ _ _ ID in the NetTeller username box.
  2. Enter your Netteller PIN/Password. If this is the first time you’ve logged in, it will be the last 4 digits of the primary account owner’s social security number.
  3. Once you are logged in, select the Options tab. Select Modify Login Information, input an easy to use “alias” in the Netteller ID box and confirm it in the next box. Next time you log in, use the much shorter, more personal “alias” you created.
 
How do I setup automated password reset?
 
  1. Log in to Midstates Online Banking and select the Options tab.
  2. Tab down to the PIN/Password Reset Question and type in a question to prompt you for a password reset. Make it easy to use and remember, such as “what is my dog’s name?” or “what’s my mother’s middle name?”.
  3. Tab down to the PIN/Password Reset Answer and input the answer to the above question.
  4. If you forget your password, all you need to do is click the password reset option for a secure and simple way to get back into online banking.
How do I enroll in eStatements?
  1. Log in to Midstates Online Banking and select the E-Documents tab.
  2. Select the Sign/Up Changes option.
  3. Click on the account(s) for which you would like a secure email statement sent to you.
  4. Read and accept the electronic disclosure.
  5. You will receive a paper statement and an eStatement on your next statement cycle. After that, eStatements only will be generated.
  6. eStatements are delivered via a secure email and available on the Midstates Bank mobile app. You can save the PDF statement onto your personal computer’s hard drive for long term storage.
How do I setup Bill Pay?
  1. Log in to Midstates Online Banking and select the Bill Payment.
  2. You will be prompted to add a Bill Payer account by selecting a checking account to use.
  3. Once the account is selected, follow the easy to use “add a payee” feature and begin paying anyone, anywhere!
  4. Bill pay functions are also available via the Midstates Bank mobile app.

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Mobile App

 
 
 
 
How do I get the Midstates Bank mobile app?
The mobile app is available to all Midstates Bank Online Banking customers and is free to install. To use Mobile Banking, simply download the app from the App Store or Google Play store and use your existing Online Banking User ID and Password to log in. Message and data rates from your mobile carrier may apply.
 
How do I know I’m downloading the real Midstates Bank mobile app?
It’s important to download mobile apps from reputable sources only. Make sure Midstates Bank is listed as the app publisher, developer or seller in the app store or download site.
 
Do I need to log in to see my account balance?

No. “Quick Access” is an option on the Preferences screen. This setting gives you a quick view of your chosen balance when you're not logged in. You’ll also need to choose the “Remember My ID” option when activating this setting.

It’s important to note that the feature is not password-protected, meaning others can see your balance if your device is lost or stolen. (Your account number is always hidden.) This setting will only apply on the device you were using when you activated it.

 
How do I unlock my account?

Tap on the menu, or the 3 lines in the upper left corner of the mobile app. Use login assistance to reset your password.  If you've tried login assistance already and have been locked out, you can try again later or contact customer service at 1-888-710-9070.

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What is an eStatement?

An electronic delivery of a bank’s customer’s bank statement – “eStatement”. It looks exactly like the paper document sent via the mail. A bank statement includes a customer’s activity with the bank – deposits, checks, ACH or ATM activity. A bank is required to send them to clients for review and reconcilement.

What are the requirements to recieve eStatements?

The basic requirements are that a customer has the online banking product (netteller) and has “opted in” to receive electronic delivery to their email address on file. Midstates Bank cannot enroll clients manually, they have to follow the regulatory guidelines of enrolling themselves. 

 
How do I enroll in eStatements online?*
 

To enroll in e-Statements follow the simple steps below:

  1. Log on to your Online Banking account
  2. Click on the E-Documents tab
  3. From there, click on the "Details" link and choose which accounts you would like delivered electronically (If you don't click on the "details" link all accounts will be delivered electronically by default)
  4. Verify your email address and type in a security phrase
  5. Click "Enroll Now" - we will send you an email confirming your enrollment

Note: eStatements requires the use of Adobe Acrobat Reader. Download the free reader here .

*If you are charged for check images now, you will be charged for eStatements with Images. On your first statement cycle after enrollment, you will receive your traditional paper statement in the mail and an electronic statement. After that, all statements (that you elect) will be sent electronically. 

How do I view, print or save my eStatement?
You will receive an email from msbna@msbna.com alerting you that your bank statement is ready. You can then log in with your online banking ID from that email, go directly to online banking or use the mobile app to view the statement, print the statement or save the statement as a PDF on your computer or other permanent storage (cloud based options).

How long are eStatement available?
Once a customer signs up, eStatements will be available for 19 months. However, it will not go “back” to prior to the customer signing up.     

Why did I receive a paper statement after signing up?
The first month you receive both an electronic and paper statement. After that, it will all be electronic.
 
What is the difference between a truncated statement vs a image statement?
Truncated statements DO NOT contain images of checks or deposits. The customer can avoid fees in most cases by received truncated statements. There are less pages within the statement. Imaged statements are just that, they contain images of checks or deposits to the customer’s account. Both forms can be sent electronically.

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Bill Pay

 
 
What is Bill Pay?
Bill Pay is a service that allows you to pay virtually anyone or any company through your online banking account. You determine who you want to pay, when you want to make the payment and which account you want the payment to come from. It's safe, secure and easy to use. Watch the demo to learn more.

 
Who can I pay with Bill Pay?
You can pay virtually any business or individual with a mailing address within the United States and Puerto Rico. For example, you can pay utilities, cable bills or credit cards, or individuals such as a landlord, babysitter or relative.
 
How do I enroll in Bill Pay?
  • It’s easy to enroll in Bill Pay. Just log in to your account and click the "Bill Pay" link to access the short enrollment form.
  • Not enrolled in Online Banking?  Simply complete the Contact Us form with the message "Enroll in Online Banking" and we'll take care of the rest.
  • Bill Pay functions are also available on the Midstates Bank mobile app.
How do I start using Bill Pay?
The first step is to add a payee, the person or company you wish to pay.
Here’s how easy it is:
  1. Log in to your account and click the "Bill Pay" link.
  2. Click the "Add a Payee" button on your home page dashboard.
  3. Enter the requested information. Typically this information can be found on your latest bill statement.
Watch the demo to learn how to pay a bill, a person and set up Bill Pay Alerts.
 
How do I learn more about Bill Pay?
Find simple, straightforward answers by visiting our Bill Pay Resource Center.
 
 

Mobile Deposit

 
 
Am I eligible for Mobile Deposit?
Any Midstates Bank customers that have a personal account that has been open at least 60 days, online banking, and have downloaded the Midstates Mobile App are eligible for Remote Deposit Anywhere (RDA).
 
How do I enroll in Mobile Deposit?
  1. Simply open the Midstates Mobile app or download the app from the App Store or Google Play store.  Use your existing Online Banking User ID and Password to log in.
  2. Select Mobile Deposit from the Menu, or the 3 lines in the upper left-hand corner.
  3. Complete enrollment and agree to the terms.
What are the limits?
Ten (10) checks deposited per day, totaling $3,000; calendar monthly limits of 20 checks totaling $5,000.
Checks deposited before 5 p.m. will be available during the end of day processing (generally by 7 p.m.). Checks deposited after 5 p.m. will be available the following business day at end of day processing.

If I have more than one account, how can I add the other accounts
Select Send Secure Message the Midstates Mobile App to to request additional accounts be added.  Don't have the mobile app handy?  Simply send an email to msbnahelp@msbna.com to complete the request.

Is there a fee to use Mobile Deposit?
There is no fee. Data rates may apply.
 

What is P2P & how does it work?
Midstates Bank P2P is a person-to-person service that lets you send and receive money from almost anyone with a U.S. bank account using that person’s email address or mobile phone number.

How do I send a payment?

  1. Log on to the Midstates Mobile App. When the “Accounts” screen is displayed, tap on the menu, or the 3 lines in the upper left corner.
  2. Under the P2P Payments heading, tap on “P2P”.
  3. Choose “Manage Cards” to add your debit card.
  4. Select payment and enter the requested information. Need only payee’s email or mobile phone number to send money.
  5. Agree to the terms and input your debit card PIN to securely send funds.

Is P2P free?
Yes. You can use P2P to send and receive money at no charge. Message and data rates may apply.

Do I have to be a Midstates Bank customer to use P2P?
Yes. You’ll need a Midstates Bank checking account and debit card to send money using P2P. You do not need to bank with Midstates Bank to receive money.

What limits apply?
If you are sending money, there is a per transaction payment limit up to $500.00 and cannot exceed the available debit card purchase limit or available account balance. There is a monthly limit of $1,500.00.
There are no limits to the amount of money you can receive.

Do I need the recipient's card or account information to send a payment?
No. You only need their cell phone number or email address. The recipient will receive a notification from 678-264-6407 or an email from Midstates Bank. The recipient enters their card or account information through a secure link provided in the notification.

When will the funds be available?
It depends on how the transaction is set up. If you are sending a payment and your recipient is another Midstates Bank customer or if your recipient’s bank supports real-time payments, he or she will typically receive the money a few minutes after it’s sent. If the bank doesn’t support real-time payments, he or she will get the money in 1 to 2 business days.

How long does it take to receive payment?
If you are receiving an incoming payment and the sender’s bank supports real-time payments, you’ll usually get the money a few minutes after it’s been sent. If the sender’s bank doesn’t support real-time payments, you will receive the money in 1 to 3 business days.

What if the recipient's debit card will not validate to accept the payment?
The recipient can enter their routing number and account number. The payment will then be processed via the ACH (automated clearing house) system to their bank within 1-2 days.

What if the recipient doesn't claim the funds?
The funds will be returned to your account after 6 days if not claimed.

What if I send to the wrong cell phone number/email address?
You need to make sure you verify this information before sending. Funds could be claimed by the wrong recipient and would require a Reg E claim to see if the funds could be recovered.

What if I realize I've sent to the wrong number or want to cancel a payment before it is collected?
Contact Midstates Bank to cancel. The funds will be returned to your card.

Is P2P secure?
Your security is very important to Midstates Bank. Because of this, we use a variety of technological tools to make sure our services and our products remain secure. We work diligently to ensure the security of your personal information. When you use P2P, you don’t need to know your recipient’s account number or other financial information. Additionally, you have the peace of mind in knowing your money is in your bank account instead of using physical checks that must pass through the mail.

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Tag Transactions

How do I tag a transaction?
Tagging transactions allows you to quickly locate your purchases. To tag a transaction, simply:
  1. Select “Tagged Transactions” from the menu accessible via the 3 white lines of the upper left-hand corner of the mobile app.
  2. Select an account
  3. Select the transaction you wish to tag
  4. Click “+ Tag”
  5. Select the desired category to complete the tag. 
 

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Bank Routing Number

 
What is an ABA Routing Number?
The ABA routing number is a 9-digit code assigned to financial institutions by The American Bankers Association (ABA). This number identifies the financial institution upon which a payment is drawn. Routing numbers are sometimes referred to as check routing numbers, ABA numbers or routing transit numbers (RTN). 
 
What is Midstates Bank's ABA Routing Number?
Midstates Bank's ABA Routing number for Electronic Transactions (for example: direct deposit, automatic payments, ACH transfer) is 104903388. For more information on routing numbers see Incoming Wire Transfers.
 

Incoming Wire Transfers

What information do I need for an incoming wire transfer?
We want the service you receive at Midstates Bank to exceed your expectations. If you are expecting a domestic wire transfer, the following details will help ensure your money gets to you as quickly as possible. Please provide the sending bank with the following:
Send To:              Receiver ABA #(Routing Number):    075912479    Bankers Bank Madison
                              Beneficiary’s Financial Institution:  104903388
                              Full Bank Name: Midstates Bank, NA
                              Address:               812 Durant St.
                                                             Harlan, Iowa 51537
 
For Credit To:   Your Midstates Bank account number
                            Your Name
                            Your Address (mailing address) City, State, zip 
                   
 
 
 

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Account Alerts

 

 
What kinds of alerts are available?
The Midstates Bank Mobile App allows you to set up Push and Two-Way Text Banking alerts. Push alerts are designed to provide you information automatically without any interaction as they will be automatically
generated. Two-Way Text Banking alerts gives you the ability to access your balance and account history using simple text commands.
 

Push Alerts

 
How do I sign up for Push Alerts?

These types of notifications are based on the criteria you provide within the mobile app. Some examples of how this could be used are below:

  • Daily Balance Alerts - "I'd like to receive my available balance every Wednesday and Friday at 4 p.m."
  • Monthly Balance Alerts - "I'd like to know my available balance at 12 p.m. on the 1st and 15th of every month."
  • Balance Threshold Alerts - "I'd like to know when my available balance is below $100" or "I'd like to know when my available balance is above $500."
  • Transaction Alerts - Know when your debit card is being used, when an ACH occurs, or when a wire is transmitted, and set a balance threshold on any of those.
To Activate Push Alerts
  • If you haven't already, enroll in Online Banking.
  • Download the Midstates Bank Mobile App to your smartphone or tablet.
  • Log in to the App with your Online Banking ID and password.
  • Open the left navigation menu.
  • Tap "Text Banking" under the "Messaging" menu and then tap "Add Alert."
  • Select the type of alerts you'd like to receive.
 

Two-Way Text Banking

 
How do I sign up for Two-Way Text Banking
By activating Two-Way Text Banking Alerts from the mobile app, you can send certain requests 24/7 to the short code 39257 to receive your account information while you're on the go. 
Use the below commands to receive on-demand access to your accounts.
  • BAL   - receive your available balance.
  • HIST  - receive the last five transactions within the last 90 days.
  • XFER  - transfer money between your accounts.
  • HELP - sends a list of available commands.
  • STOP - deactivates text banking services.
To Activate an Account for Two-Way Text Banking:
  • Log in to the App with your Online Banking ID and password.
  • Open the left navigation menu.
  • Tap "Text Banking" under the "Messaging" menu and then tap "Two-Way Text Banking."
  • Select the mobile phone number associated with your profile.
  • Swipe left on the account you would like to enable Two-Way Text Banking alerts and select "Activate." To deactivate an account swipe left and select "Deactivate."
 
How do I receive alerts for debit card transactions?
  1. Log on to the Midstates App.  When the “Accounts” screen is displayed, tap on the Menu, or the 3 lines in the upper left corner. 
  2. Under the Messaging heading, tap on “Text Banking”.  In the Text Banking menu, click on “Add Alert”.Then select Alert type.  Click on “Transactions” and continue.
    Transaction type=debit card
    Start time=24/7
    Stop time=24/7
    Amount=greater than 0

 
Is there a fee to get text alerts?
There is no fee. Message and data rates may apply.
 
How do I learn more about protecting my financial information?
Visit our Fraud Protection Recommendation page to learn more about online safety and how to protect your financial information. 
 

Mobile Wallet 

 
 
What is a Mobile Wallet?
A Mobile Wallet is a way to carry your debit card information in a digital form on your mobile device. Instead of using your physical plastic debit card to make purchases, you can pay with your smartphone, tablet or smartwatch.
 
How does the Mobile Wallet work?
  1. Download or open the mobile wallet app.
  2. Add your Midstates Bank debit card information to the mobile wallet.
  3. Authenticate your device and card by either receiving a onetime passcode via text, email or a call to the bank.
  4. When you check out at participating merchants, access the mobile wallet and choose your card. If you are making an in-store purchase, just hold your mobile device up to the terminal.
 
How do I get the Mobile Wallet App?
The Midstates Bank Mobile Wallet is available for download on Apple Pay®, Google PayTM, Samsung Pay and MasterPass. Be sure to check which mobile device is required and which merchants accept the wallet.

Is using a Mobile Wallet secure?
The Wallet has certain security features and procedures to protect you against unauthorized use. You are responsible for maintaining the confidentiality of your User IDs and passwords related to your device(s) and Wallet. If you permit other persons to use your Wallet credentials, you are responsible for any transactions they authorize or perform. If you believe your Wallet has been accessed without your authorization, you must notify us immediately.

When you use your Midstates Bank Debit Card, you get additional protections:
  • Midstates Bank Debit Cards come with expanded Debit Card benefits through MasterCard® such as price protection, extended warranty and satisfaction guaranty.
  • When you download the Midstates Bank Mobile App, you can sign up for account activity alerts, and view your transactions, keeping you informed and in control of your finances.
What are the Limits?
The daily spending limits already in place on your debit card will also apply to your transactions using the Mobile Wallet.

What if my card or mobile device is lost or stolen?
If you believe your card or mobile device has been lost or stolen or that your Wallet has been accessed without your authorization, you must notify us immediately.

Is there a fee to use the Mobile Wallet?
There is no fee. Data rates may apply.

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Truncated Statements (Online Check Images)

 
What is a Truncated Statement?
A truncated statement includes Midstates Bank enhanced checking account statement with checks listed in order, electronic activity is separated and other accounts are listed for your convenience. A truncated statement DOES NOT include images. However, images are available 24 hours a day 7 days a week through your online banking and mobile app accounts.

By opting to truncate your statements Midstates agrees to “safe keep” your images – meaning the bank will retain and if you are ever audited by the IRS, Midstates will provide the images at no charge – the bank improves it’s delivery by quicker statement turn around, less printing, and is able to maintain low cost products to our customers. Give us a call today to find out how to truncate your account.
 

Touch ID

 
How does Touch ID work?
 
How does Touch ID work?
Instead of logging into your account with your username and password each time you open the Midstates Bank Mobile App, you can use your fingerprint to login.
 
How do I setup Touch ID?
  1. The Midstates Mobile App is available to all Online Banking customers and free to install.
  2. Once you have established Touch ID service on your iPhone®, log on to the Midstates Mobile App and enable Touch ID by selecting the Menu, or 3 lines in the upper-left hand corner.
  3. Select Settings the Touch ID.
  4. Update credentials including User ID and Password and select Continue.

Health Savings Account (HSA)

 

Midstates Bank Basic HSA Product Information

 

Eligibility

 
Enrollment
 
How can I set up a HSA at Midstates Bank and what type of account is my HSA?

Simply stop in or call 800-813-7291 for the office nearest you. Your HSA will be held in a custodial account with Midstates Bank. The account will function like a checking account, and is subject to all of the rules of a checking account.

What is needed to open a HSA checking account at Midstates Bank?

  • Name and Identification
  • Street Address
  • Date of Birth
  • Social Security number

Will my HSA earn interest?

Yes, you will earn interest on your HSA balance. Rates are variable and may be changed at Midstates Bank’s discretion; you will be informed of your current interest rate when you open your HSA. After that, rates can be obtained by contacting Midstates Bank.

What tax statements will I receive from the bank?

Midstates Bank is required to issue two types of tax statements to you and the IRS: a 1099-SA and a 5498-SA.

1099-SA: This document lists your total distributions from your HSA for the year. You will receive this statement by January 31 for the previous tax year. You should ensure that you have receipts for eligible expenses equal to the amount of the distributions on the 1099-SA to avoid having to pay taxes and penalties on your distributions.

5498-SA: This document lists your total contributions for the year, any rollover HSA contributions, and the fair market value of your HSA as of December 31. You will receive this statement by May 31 for the previous tax year. This document is issued later because the IRS requires the bank to list all contributions for the previous tax year, which can be made as late as April 15 of the following calendar year. You should verify that the amounts reported on the 5498 matches your contribution records and your IRS form 8889, if filed.

Will I receive a bank statement for my HSA?

Yes. Midstates Bank will send you a regular monthly statement of deposits and withdrawals.

Can my account ever become overdrawn?

It is possible to overdraw your account. Your balance is usually verified before an electronic card transaction occurs, but you can write a check or create an automatic clearing house entry that could overdraw the balance.

Would you pay the checks if there isn't enough money on deposit?

Unlike a Flexible Spending account, you must have funds on deposit before paying for qualified medical expenses. The IRS does not allow you to spend funds that have not been deposited, so the bank is unable to pay the checks and they would be returned. Overdraft protection is not permitted on a HSA and the overdraft fees shown on the Schedule of Fees would apply.

Can I get my canceled checks back?

You will receive check images to improve record keeping.

How can I learn more about HSAs?

Additional resources: Visit www.treas.gov and click on Health Savings Accounts  

 

Midstates Bank Basic HSA Product Information

  • Interest Bearing Checking Account: Current Rate is .15% APY.
  • Free Introductory Box of Checks
  • Free Online Banking, Mobile Banking and Bill Payer
  • $1.50 per month maintenance fee
  • Free return of check images to improve record keeping

All accounts are FDIC insured.

 

Eligibility
What is an HSA?
A health savings account (HSA) is a tax-favored account created for the purpose of paying out-of-pocket medical expenses and works in conjunction with high deductible health insurance.
  • Tax-deductible: Contributions to the HSA are 100% deductible from gross income (up to the legal limit).
  • Tax-free: Withdrawals to pay “qualified medical expenses” are free from federal income tax.
  • Tax-deferred: Interest earnings accumulate tax-deferred, and if used to pay qualified medical expenses, are tax-free.
  • HSA money is yours to keep: Unlike a flexible spending account (FSA), unused money in your HSA isn’t forfeited at the end of the year; it continues to grow, tax-deferred.
 
Who is eligible for a HSA?
An eligible individual (determined on the first day of each month basis) must be: 
    1) Covered by a qualified High Deductible Health Insurance Plan (HDHP);
    2) Not covered under other health insurance that is not an HDHP;
    3) Not enrolled in Medicare; and
    4) Not another person’s dependent on their tax return.
In addition, there are no income limits on who may contribute to an HSA and no requirement of having earned income to contribute to HSAs. The HSA owner must determine if he or she is eligible to establish an HSA.
 
For any month that an individual meets the criteria for an eligible individual, he or she may make and/or receive on his or her behalf an HSA contribution.
 
Once contributions are deposited into an HSA, the HSA owner may continue to maintain the HSA even after the owner ceases to become an eligible individual for purposes of making contributions. HSAs are individual accounts that are NOT forfeitable. HSA owners do not lose their HSA because of a change in employment, the loss of HDHP coverage, coverage under a non-HDHP, or enrollment in Medicare.
 
Can my spouse and I have a joint HSA?
You and your spouse cannot have a joint HSA. HSAs are for individuals only. If you are both eligible, however, you may both have individual HSAs. If you desire, you may designate your spouse to be an authorized signer on your account.
 
What are the limits for a 2018 health plan?

Minimum
Deductible
 Maximum Out-of-Pocket
Contribution Limit 55+ Catch-Up Contribution Limit

Single

$1,350

$6,650


$3,450

Additional $1,000

Family

$2,700

$13,300


$6,900

Additional $1,000

Out of pocket expenses include deductibles and co-payments. Out of pocket expenses do NOT include premiums or non-covered services within the health plan.

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Contributions
Who can contribute to my HSA?

Contributions to HSAs can be made by the employer, the individual, or both. 

  • If made by the employer, it is not taxable to the employee (excluded from income and wages) 
  • If made by the individual, it is an "above-the-line" deduction 
  • Family members may also make contributions to an HSA for another family member as long as the family member is eligible and covered under the High Deductible Health Plan.
Does my contribution depend on when I establish my HSA account or when my HDHP coverage begins?

Your eligibility to contribute to an HSA is determined by the effective date of your HDHP coverage. Your annual contribution depends on the number of months of HDHP coverage you have during the year (technically, the months where you have HDHP coverage on the first day of the month). The amount you can contribute is not determined by the date you establish your account. However, medical expenses incurred before the date your HSA is established cannot be reimbursed from the account.

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Use
Who decides whether the money I'm spending from my HSA is for a "qualified medical expense"?

You are responsible for that decision, and therefore should familiarize yourself with what qualified medical expenses are and keep your receipts in case you need to defend your expenditures or decisions during an audit.

What is a “qualified medical expense"?

A qualified medical expense is one for medical care as defined by Internal Revenue Code Section 213(d), Publication 502. The expense must be primarily to alleviate or prevent a physical or mental defect or illness, including dental and vision.

A few examples of expenses that do not qualify are:

  • Over-the-counter medications unless they are prescribed by a physician
  • Surgery for purely cosmetic reasons
  • Health club dues
  • Illegal operations or treatment
  • Maternity clothes
  • Toothpaste, toiletries and cosmetics
What happens if I don't use the money for “qualified medical expenses"?
If the money is used for other than qualified medical expenses, the expenditure(s) will be taxed and, for individuals who are not totally and permanently disabled or over age 65, subject to a 20% tax penalty.
 
Can my HSA be used to pay health insurance premiums?

No, this would be a non-medical withdrawal, subject to taxes and penalty. There are some exceptions.

No penalty or taxes will apply if the money is withdrawn to pay premiums for:

  • Qualified long-term care insurance (qualified dollar amount depends on your age, see IRS Publication 502 for the amounts deductible by age); or
  • Health insurance while you are receiving federal or state unemployment compensation; or
  • Continuation of coverage plans, like COBRA, required under any federal law; or
  • Medicare premiums.
Can I use the money in my HSA to pay for medical care for a family member?

Yes, you may withdraw funds to pay for the qualified medical expenses for yourself, your spouse or a dependent without tax penalty. This is one of the great advantages of HSAs.

What happens to the money in my HSA if I no longer have HDHP coverage?

The unused balance in a Health Savings Account automatically rolls over year after year. You won't lose your money if you don't spend it within the year.

What happens to the money in a Health Savings Account after I turn age 65?

You can continue to use your account tax-free for out-of-pocket health expenses. When you enroll in Medicare, you can use your account to pay Medicare premiums, deductibles, co-pays, and coinsurance under any part of Medicare. If you have retiree health benefits through your former employer, you can also use your account to pay for your share of retiree medical insurance premiums. The one expense you cannot use your account for is to purchase a Medicare supplemental insurance or "Medigap" policy.

Once you turn age 65, you can also use your account to pay for things other than medical expenses. If used for other expenses, the amount withdrawn will be taxable as income but will not be subject to any other penalties. Individuals under age 65 who use their accounts for non-medical expenses must pay income tax and a 10% penalty on the amount withdrawn.

Can I use my HSA to pay for medical expenses incurred before I set up my account?

No. You cannot reimburse qualified medical expenses incurred before your account is established. We recommend you establish your account as soon as possible.

Who will be the "bookkeeper" for my HSA?

It is your responsibility to keep track of your deposits and expenditures and keep all of your receipts. If you run out of HSA funds (and therefore need to use your HDHP), you may need to send those receipts to your insurer.

How do I use my HSA to pay my physician when I'm at the physician's office?

If you are still covered by your HDHP and have not met your policy deductible, you will be responsible for 100% of the amount agreed to be paid by your insurance policy to the physician. You can pay with your Midstates Bank HSA checking account.

If your physician does not ask for payment at the time of service, the physician will probably submit a claim to your insurance company, and the insurance company will apply any discounts based on their contract with the physician. You should then receive an "Explanation of Benefits" from your insurance plan stating how much the negotiated payment amount is, and that you are responsible for 100% of this negotiated amount. If you have not already made any payment to the physician for the services provided, the physician may then send you a bill for payment.

Is it true that individuals 65 or older can withdraw funds for any reason without penalty?

If an individual is age 65 or older, regardless of whether the individual has been enrolled in Medicare, there is no penalty to withdraw funds from the HSA. As always, normal income taxes will apply if the distribution is not used for unreimbursed medical expenses (expenses not covered by the medical plan). 

What happens to my HSA when I die?

Your HSA will be treated as your surviving spouse’s HSA, but only if your spouse is the named beneficiary. If there is no surviving spouse or your spouse is not the beneficiary, then it will cease to be an HSA and will be included in the federal gross income of your estate or named beneficiary.

 

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