qualified HSA distributions effect on CSS/ PROFILE and FAFSA

Paying for College
1

Does anyone know (or better have direct experience) how qualified HSA distributions (not contributions) effect CSS/ PROFILE? I have read on other threads here, that qualified HSA distributions do not effect FAFSA.
Thanks in advance!
parentsofsboys

2

Zero impact on FAFSA. Last time I completed Profile, there was a question asking about out-of-pocket medical expenses paid, although there was no distinction to be made as to whether or not those payments came from an HSA. I don’t think making qualified payments from an HSA will make any difference in how need-based aid is calculated using Profile.

3

Thank you BelknapPoint for sharing your direct experience and thoughts. I would be interested to hear if others have similar or different experiences as to whether qualified HSA distributions (not contributions) effect CSS/ PROFILE.

Thank you,
parentsofsboys

4

Have you reviewed and maybe completed the current version of Profile? If so, which particular Profile question(s) might call for a disclosure of qualified HSA distributions? If there’s no place on Profile to report it, there can be no effect on need-based aid as calculated by Profile.

5

BelknapPoint: I have reviewed the PROFILE questions available through the College Board’s video tutorial, but am 2-years out from completing PROFILE for financial aid, so I cannot see or review the current actual list of PROFILE questions prior to creating an account and completing as part of admissions process. I have not been able to read anywhere one way or the other if qualified HSA distributions were taken into account by PROFILE - other than your experience/ perspective. I did find reference that FAFSA does not factor qualified HSA distributions, but understand that PROFILE often considers additional factors as relevant to aid determination. I was looking to others (such as yourself) who have already completed the PROFILE or had direct experience.

Thank you,
parentsofsboys

6

I filled out the profile the past 3 years and did not put it anywhere. It is always possible that a supplemental question can ask about it.

7

Thanks privateID and BelknapPoint: I just reviewed IRS Form 8889 (and instructions) which covers HSA contributions and distributions. It is pretty clear, distributions are covered under Section II. If distributions are to reimburse only qualified expense you are instructed to enter a “0” on IRS Form 1040, line 21 “other income”. That satisfies it for me unless anyone has an experience to report to the contrary.
Thanks again for sharing information and experience,
parentsofsboys