A direct rollover is a transfer from a trustee (like an HSA provider, a bank, or financial institution) to the account holder. This type of transfer requires the account holder to momentarily take possession of the funds, and then transfer (deposit) the funds with the new trustee.
This process is best for account holders that want to be in direct control of the transfer and want access to funds quickly.
- You have 60 days to deposit the funds in your new HSA once the funds are in your hands. Failure to comply will result in a 20% income tax penalty.
- HSA direct rollovers can only be done once in a 365 day period to maintain the account’s tax-free status.
Step 1. Account holder must contact the current HSA provider to initiate a transfer. The initiating process may vary per provider.
Step 2. The funds will come directly to the account holder from their initial HSA provider in one of two forms: a check, or, an electronic fund transfer via an Automated Clearing House (ACH). Typical timeline unknown: Timeline varies per HSA provider and banks. Please contact your current providers for status updates.
- Check requirements: the account holder must deposit the check with the bank connected to their Lively HSA.
- ACH requirements: the account holder must ensure the funds are transferred into the account connected to their Lively HSA.
Step 3. When the funds have cleared, the account holder must log in to their Lively account to initiate the Direct Rollover transfer. You can do so by navigating to the 'HSA Transfers' tab > select “Start New Transfer” > select “Initiate Rollover."
Step 4. Once initiated, Lively will debit the linked bank account for the amount of the rollover and credit it to your Lively HSA. Typical timeline: Please allow 3-5 business days for the funds to become available for use.
Learn more about the different types of transfers here.Updated: