You can move HSA money between accounts, but the rules depend on whether you're changing employers, insurers, or just banks

A rollover in HSA terms usually means moving your balance from one HSA to another without losing the money to taxes or penalties. The IRS allows this, but the mechanics change depending on your situation. If you're leaving a job, switching health plans, or straightforward want a different bank to hold your HSA, the process is straightforward — but you need to follow the right steps, and timing matters.

The most common scenario is a trustee-to-trustee transfer: your old HSA custodian (usually a bank or insurance company) sends the money directly to your new one. No money touches your hands, no tax withholding happens, and there's no annual limit on how much you can move. This is the safest route and the one most custodians prefer.

A second option is a rollover by check or direct deposit, where you withdraw the money yourself and deposit it into a new HSA within 60 days. This works, but it's riskier — if you miss the 60-day window, the IRS treats it as a taxable withdrawal, and you'll owe income tax plus a 20% penalty if you're under 65. You also get only one HSA rollover per 12-month period if you go this route, though trustee-to-trustee transfers don't count against that limit.

Key Takeaways

  • A trustee-to-trustee transfer moves your HSA balance directly between custodians with no tax consequences and no annual limit on how many you do.
  • If you withdraw the money yourself, you have 60 days to deposit it into a new HSA, and you can do this only once per 12-month period.
  • Leaving your job does not automatically close your HSA — you can keep it open with the same custodian or move it to a new one.
  • Your new HSA custodian must be a bank, credit union, or insurance company that the IRS recognizes as an HSA trustee or custodian.

Trustee-to-trustee transfers: the standard method

This is the move you should make if you have a choice. You contact your new HSA custodian and ask them to initiate a trustee-to-trustee transfer. They'll send paperwork to your old custodian requesting the balance. Your old custodian then sends the money directly to the new one — you never see it, and the IRS never sees it as income to you.

The timeline varies. Some transfers complete in a few business days; others take two to three weeks. Ask your new custodian for an estimate before you start. If you're switching because you're leaving a job, don't wait until your last day — start the transfer process a week or two before, so the money is settled in your new account before your old employer's plan closes.

There is no limit to how many trustee-to-trustee transfers you can do in a year, and there's no limit on the amount. You can move your entire balance or part of it. This is the route to use if you're unhappy with your current custodian's fees, investment options, or customer service.

Self-directed rollovers: when you handle the money yourself

If your old custodian won't initiate a transfer or you want to move the money quickly, you can withdraw it yourself. Request a check or direct deposit from your old HSA. You then have exactly 60 calendar days to deposit that money into a new HSA. The clock starts the day you receive the money, not the day you request it.

This method carries real risk. If you deposit the money on day 61, the IRS treats the entire amount as a taxable withdrawal. You'll owe income tax on it at your ordinary tax rate, plus a 20% penalty — so a $5,000 withdrawal could cost you $1,000 or more in taxes and penalties if you miss the important date. The new HSA custodian won't know about the 60-day rule; it's your responsibility to track it.

The IRS also limits you to one self-directed rollover per HSA per 12-month period. If you do a rollover in January, you cannot do another one until January of the following year — even if the first one failed or you changed your mind. Trustee-to-trustee transfers don't count against this limit, so if you've already done a self-directed rollover this year, ask your new custodian to initiate a trustee-to-trustee transfer instead.

What happens to your HSA when you leave a job

Your HSA is yours to keep. Unlike a 401(k) or health insurance, your HSA doesn't close when you leave your employer. The money stays in the account, and you can keep it with the same custodian indefinitely, even if you're no longer on your employer's health plan.

However, many employers use HSA custodians that are tied to their group health plan. When you leave, you may lose access to that custodian's platform or face higher fees for individual accounts. In that case, moving your balance to a custodian of your choice makes sense. You can move it to a bank HSA, a brokerage HSA (which lets you invest the money), or an insurance company HSA — whatever offers the features and fees you want.

If you're moving to a new job with a different health plan, you can keep your old HSA and open a new one with your new employer's plan. You can have multiple HSAs as long as you don't exceed the annual contribution limit across all of them combined. Many people keep an old employer HSA for its investment options while using a new employer HSA for current contributions.

Choosing a new HSA custodian

Not every bank or investment firm offers HSAs. The custodian must be approved by the IRS to hold HSA funds. Most major banks (Chase, Bank of America, Wells Fargo) offer HSAs, as do many credit unions and brokerages like Fidelity and Vanguard. Insurance companies that sell high-deductible health plans often offer HSAs as well.

Before you move, compare fees. Some custodians charge monthly maintenance fees ($2 to $5), per-transaction fees, or investment fees if you want to invest the money rather than keep it in cash. Others charge nothing. If your balance is small (under $1,000), a no-fee custodian makes sense. If your balance is large and you plan to invest it, a brokerage HSA with low investment fees may be worth the setup effort.

Check what happens to your debit card. Some HSA custodians issue a debit card that lets you pay medical expenses directly from the account; others don't. If you use the card regularly, make sure your new custodian offers one.

Timing and coordination with your health plan

If you're moving your HSA because you're switching health plans, coordinate the timing. You can only contribute to an HSA if you're enrolled in a high-deductible health plan (HDHP). If there's a gap between when your old plan ends and your new one starts, you cannot contribute to your HSA during that gap, but you can still move money between accounts.

If you're moving in January, do it early. Many custodians process transfers faster at the beginning of the year, and you'll have your new account set up before you need to make your annual contribution. If you're moving mid-year, give yourself at least two weeks before you need to use the account for medical expenses, so the money has time to settle.

Keep records of the transfer. Save the confirmation number from your old custodian and the deposit confirmation from your new one. If the IRS ever questions the move, you'll need proof that it was a legitimate transfer, not a taxable withdrawal.

What you cannot do with HSA rollovers

You cannot roll over an HSA into a different type of account — not into a 401(k), not into an IRA, not into a regular savings account. HSA money must stay in an HSA. If you withdraw it and don't deposit it into another HSA within 60 days, it's taxable income.

You also cannot use a rollover to move money from someone else's HSA into yours, even if you're married or related. Each HSA is tied to the person whose name is on the account. If your spouse has an HSA, they can roll it over to a new custodian, but you cannot combine it with yours.

Once you turn 65, the rules relax slightly. You can withdraw HSA money for any reason without the 20% penalty (though you'll still owe income tax on non-medical withdrawals). But the rollover rules themselves don't change — you still have 60 days if you do a self-directed rollover, and trustee-to-trustee transfers still have no limit.

Frequently Asked Questions

How long does a trustee-to-trustee transfer take?

Most transfers complete within 5 to 10 business days, but some custodians take up to three weeks. Ask your new custodian for their typical timeline before you start. If you need the money quickly, ask whether they can expedite the transfer or whether you should do a self-directed rollover instead.

What if I miss the 60-day important date on a self-directed rollover?

The money becomes taxable income. You'll owe income tax at your ordinary rate plus a 20% penalty. You cannot fix this by depositing the money later. If this happens, you'll need to report it on your tax return, and you may owe additional taxes when you file.

Can I move my HSA if I'm still working for the same employer?

Yes. You can move your HSA to a different custodian at any time, regardless of whether you're still employed. You don't need permission from your employer. Just contact your new custodian and ask them to initiate a trustee-to-trustee transfer.

Do I have to move my HSA when I change health plans?

No. Your HSA is separate from your health plan. You can keep your old HSA with the same custodian even after you switch plans, or you can move it. Many people keep an old HSA for its investment options while opening a new one with their new employer.

What if my old custodian charges a fee to close my account?

Some custodians charge a small fee ($25 to $50) to close an HSA. Ask about this before you start the transfer. If the fee is high, factor it into whether moving is worth it. For a trustee-to-trustee transfer, the fee usually comes out of your HSA balance, so your new custodian receives slightly less.