You can take your HSA and stick it where the sun don't shine!

1) I have been strongly encouraged to open an H.S.A. account and enter the account number into the company benefits site before Friday December 19th. H.S.A. accounts with different banks/credit unions have different monthly fees/interest rates, etc.
After much evaluation and research, I decided on 3 different Credit Unions that I liked, and I started calling them. All of these Credit Unions had H.S.A. accounts with NO monthly fee (it was free) which is why I chose them. I refuse to pay a monthly fee just to have an account opened (thanks a lot BofA - $4.50/month? no thanks.). The first one (based in California) wouldn't let me join as a member, so scratch that one. The 2nd one was based in New Jersey - same thing. The last one was local to Atlanta, so I called them. They said they could open an H.S.A. for me, but I could not have a zero balance, and I'd need to deposit funds to open it. However, I'd be penalized by the I.R.S.
Why?
2) I am not "eligible" to make H.S.A. contributions (aka Deposits) until January 1st, 2009. Because our HDHP plan won't start until then.
3) Most (not all, but most) of the banks/Credit Unions I called, won't LET you open an H.S.A. with a zero balance. You have to put money into the account.
4) There are I.R.S. penalties for depositing money into an H.S.A. before you are eligible.
5) Nobody (My own HR dept or the Benefits dept. etc) could explain to me what these mysterious penalties were, so I actually called the I.R.S. today. http://www.irs.gov/help/article/0,,id=96730,00.html
6) According to the I.R.S. any money you put into your H.S.A. before eligible (ie: before Jan 1, 2009) will be penalized a 6% excise tax.
In my example that would mean I had to deposit $50 to open the H.S.A. and then that would be taxed 6% by the I.R.S.
The Bank/Credit Union has to send you (and the IRS) an 8889 form at the end of each year for H.S.A. accounts. This will have to be filed along with your normal 1040 form whenever you file your taxes prior to Apr. 15, 2009.
However, according to the I.R.S. lady, if you withdraw the ineligible money (and any interest it earned in the H.S.A.) before Apr. 15, 2009, you won't have to pay the 6% excise tax. However, you will need to file the 8889 form and show that you withdrew the money back out. She mentioned a 5498 form also, but I was getting really lost at that point. I was so fed up.
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The other option is that you can wait until Jan. 2nd, 2009 (the first business day of the yr), and open the H.S.A. then. However, as the Corporate email stated "You must enter your HSA bank information by Friday, December 19, 2008 for HSA contributions to start in January of 2009. If you provide your HSA bank information after that date, your HSA contributions will begin as soon as administratively possible."
Which isn't a bad thing, unless you somehow need to use H.S.A. funds for medical reasons prior to the "Administratively possible' date.
You CAN deposit your own after-tax dollars into your H.S.A. at any time after eligibility (provided your contributions for the year are within the guidelines outlined for H.S.A. accts), and then you would claim this money as a deduction when you file your 2009 taxes. It isn't penalized, but you just need to claim it so you aren't taxed on that money.
Clear as mud?
yes I let me just tell you how much I LOVE this new insurance plan (insert sarcasm here).