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How to set up HSA Benefits in Warp

Nicole Chinuntdet avatar
Written by Nicole Chinuntdet
Updated this week

Setting up Health Savings Account (HSA) benefits in Warp allows you to automate pre-tax HSA contributions for employees who already have existing HSA bank accounts. This guide walks through the setup process for both employers and employees.

Eligibility Requirements

The first step is confirming eligibility. Your company must offer a High Deductible Health Plan (HDHP) to qualify for HSA contributions. This is a non-negotiable requirement set by federal regulations.

Opening an HSA bank account

Once you've confirmed HDHP coverage, here's how employees can get started:

  1. Open an individual HSA bank account (we recommend Optum Bank for their straightforward setup process)

  2. Add the HSA account to their payroll profile

  3. Specify their preferred paycheck split between HSA and personal accounts

Connecting HSA Accounts

For Employers/Admins

Step 1: Create HSA Benefit Configuration

  1. Navigate to the employee's profile

  2. Go to Benefits section

  3. Click Create New benefit

  4. Select HSA as the benefit type

  5. Configure the HSA benefit settings:

    • Set contribution amount as "per paycheck" (recommended for easier setup)

    • Example: For $100/month contribution with semi-monthly payroll, enter $50 per paycheck

    • Verify annual contribution limits compliance

    • Configure employer matching (if applicable)

    • Set effective date

Step 2: Set Up Recurring Reimbursement

  1. While in the employee's profile, set up a recurring reimbursement

  2. Configure the reimbursement to:

    • Match the HSA contribution amount per paycheck (use same amount as Step 1)

    • Example: If HSA benefit is $50 per paycheck, set reimbursement to $50 per paycheck

    • Disburse the HSA benefit into the employee's payroll

    • Run automatically each pay period

  3. Save the recurring reimbursement configuration

Employee steps

Step 3: Connect HSA Bank Account

  1. Log into your Warp employee portal

  2. Go to Banking or Direct Deposit settings

  3. Click on Split Paycheck to create a new paycheck split

Step 4: Configure Paycheck Split

  1. Navigate to Direct Deposit settings

  2. Set up paycheck splitting:

    • Allocate the same per-paycheck amount to your HSA bank account

    • Example: If HSA benefit is $50 per paycheck, allocate $50 to HSA account

    • Set remaining balance to go to your primary checking account

  3. Verify the split amounts match your HSA benefit configuration

  4. Save your direct deposit preferences

Important Notes

Per-Paycheck Setup: For easier configuration, set up HSA contributions as "amount per paycheck" rather than monthly. This ensures consistent amounts across all three setup steps (benefit creation, reimbursement, and paycheck splitting).

Pre-tax Treatment: HSA contributions are automatically processed as pre-tax deductions, reducing your taxable income.

Annual Limits: Ensure total HSA contributions (employee + employer) don't exceed IRS annual limits:

  • Individual coverage: $4,300 (2024)

  • Family coverage: $8,550 (2024)

πŸ“… Timing: Changes typically take effect on the next payroll cycle after setup completion.

Verification

After setup, verify:

  • HSA deduction appears correctly on paystub as pre-tax

  • Funds are deposited into the correct HSA account

  • Contribution amounts match your benefit configuration

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