Can You Use an HSA for Pet Expenses? What Every Pet Owner Needs to Know in 2025

By Olivia ParkerLast Updated April 23, 2025

Understanding HSAs and Pet Expenses: What Does the IRS Allow?

Health Savings Accounts (HSAs) are designed as tax-advantaged tools to help consumers manage their own medical costs. Many pet owners wonder if these funds can be used for veterinary bills and other pet-related healthcare expenses. According to current IRS regulations, HSAs cannot be used for typical pet expenses , such as annual check-ups, vaccinations, or emergency veterinary care for household pets. The IRS definition of ‘qualified medical expenses’ under Section 213(d) of the Internal Revenue Code is focused strictly on human healthcare [1] . This means that, despite our pets being considered family, their medical costs are excluded from HSA eligibility.

Are Any Pet Expenses Eligible for HSA Funds?

For most pet owners, the answer remains a firm ‘no.’ Regular veterinary bills-including routine visits, surgeries, dental cleanings, and medication- do not qualify as HSA-eligible expenses . The IRS does not recognize any pet-related costs for HSA reimbursement, regardless of the animal’s role in your household [5] . Even if a doctor prescribes pet ownership for health reasons, or an animal provides emotional support, these expenses remain non-qualified.

If you attempt to use your HSA card for such costs, the payment may be processed. However, this would be considered a non-qualified distribution, requiring you to report the expense on your taxes and pay both income tax and a 20% penalty. Some HSA administrators actively monitor accounts and may flag or reject transactions at veterinary offices [5] .

Exception: Service Animals and HSA Eligibility

One significant exception exists for service animals . If you have a service animal due to a recognized disability, HSA funds may be used for the purchase, training, and ongoing maintenance of that animal. This exception is strictly defined and applies only to animals trained to assist with physical or mental disabilities, not to pets offering emotional support or companionship [2] . Documentation is required, typically from a healthcare provider, and expenses must be directly related to the service function of the animal.

For example, if you have a guide dog for visual impairment or a service animal trained to assist with mobility challenges, HSA funds can cover the animal’s medical care, training costs, and necessary supplies. Emotional support animals, therapy pets, and general companion animals do not qualify under current IRS rules.

Recent Legislative Developments: The PAW Act

In September 2024, bipartisan legislation known as the People and Animals Well-being (PAW) Act (H.R. 9508) was introduced in Congress. If enacted, this bill would amend IRS regulations to allow pet owners to use HSA and Flexible Spending Account (FSA) funds for up to $1,000 in veterinary care or pet health insurance annually. The PAW Act aims to help owners of both pets and service animals, particularly veterans and individuals with disabilities, by updating the federal definition of ‘service animal’ and expanding coverage [3] .

While the PAW Act promises relief for pet owners facing high veterinary costs, it is important to note that, as of August 2025, the bill has not yet been passed into law. Pet owners interested in this potential change should stay informed by following updates from the U.S. Congress and reputable veterinary industry organizations. If the bill passes, more pet healthcare expenses may become HSA-eligible in the near future.

Alternatives to Using an HSA for Pet Expenses

Since regular pet healthcare costs are not currently eligible for HSA reimbursement, pet owners need alternative strategies for managing veterinary bills:

Pet-Specific Savings Accounts: Consider setting up a dedicated savings account for your pet’s healthcare needs. Some financial institutions and specialty providers offer Pet Medical Savings Accounts (PMSAs) designed to help you budget for veterinary expenses [4] . PMSAs are not tax-advantaged like HSAs, but they allow you to prepare for both routine and emergency care.
Pet Insurance Plans: Many companies offer pet health insurance policies that cover accidents, illnesses, and preventive care. While pet insurance premiums are not HSA-eligible, these plans can offset high veterinary costs. Compare coverage options, exclusions, and deductibles to find the best fit for your pet.
Payment Plans and Credit Options: Some veterinary clinics offer payment plans or accept third-party financing services to help pet owners manage large bills over time. Research local options and always read the terms carefully.
Emergency Funds: Building an emergency fund specifically for pet care is a prudent financial strategy. Regularly set aside money in a separate account to ensure you can cover unexpected procedures or treatments.
Local and National Assistance Programs: For pet owners facing financial hardship, there are nonprofit organizations and veterinary foundations that offer grants or subsidies for critical pet medical care. Examples include RedRover Relief and the Humane Society’s veterinary assistance programs. To find such resources, search for ‘veterinary financial assistance programs’ and check eligibility criteria.

Step-by-Step Guidance for Responsible Pet Healthcare Planning

Review HSA and IRS Guidelines: Always consult the latest IRS publications and your HSA administrator’s official resources to confirm what expenses are eligible. For updates on pending legislation like the PAW Act, monitor the U.S. Congress website and reputable veterinary organizations.
Set Up a Pet-Specific Savings Strategy: If HSAs cannot be used, open a separate savings account or PMSA for your pet. Calculate annual costs, including preventive care, emergencies, and possible surgeries, then set a monthly savings goal.
Evaluate Pet Insurance Options: Research and compare pet insurance plans, considering your pet’s age, breed, and medical history. Use trusted review platforms and official provider websites for accurate information.
Explore Payment Plans and Assistance Programs: Ask your veterinarian about available payment options. For financial assistance, contact organizations like RedRover Relief and search for ‘veterinary financial assistance’ in your region.
Stay Informed on Legislative Changes: Legislative efforts to expand HSA eligibility for pet expenses are ongoing. Stay engaged with advocacy groups and subscribe to news updates from the American Veterinary Medical Association (AVMA) and similar organizations.

Potential Challenges and Solutions

Challenge: Rising veterinary costs may strain household budgets, especially for unexpected emergencies.

Solution: Proactively build a pet emergency fund and consider enrolling in a pet insurance policy. If you have a service animal, work with your healthcare provider to ensure expenses are properly documented for HSA eligibility.

Challenge: Uncertainty around future IRS rules and legislative changes.

Solution: Regularly review IRS updates and congressional bills related to pet healthcare. Join pet owner advocacy groups to stay informed and contribute to policy discussions.

Alternative Approaches to Funding Pet Care

While HSAs remain restricted for pet use, innovative financial products like the Pet Medical Savings Account (PMSA) offer a way to budget for veterinary bills without waiting for legislative changes [4] . Additionally, some employers now offer pet insurance as a voluntary benefit; ask your HR department about available options.

For service animal owners, maintain thorough records and consult your HSA administrator to ensure compliance. For all pet owners, combining a savings account with insurance and assistance programs provides a comprehensive safety net.