How would I use medical receipts to get money? I thought I just use the HSA card to pay for whatever medical expenses I have.
You can do that. That's simpler. However you're not required to: any medical expenses you have after you establish the HSA can be paid from the HSA at any point in the future.
So you could pay your medical bills out-of-pocket right now, let your money in the HSA grow with tax-free interest, and then at some point in the future reimburse yourself for your medical expenses.
However you'd have to keep track of the receipts, and the difference would just be tax-free interest vs taxible interest. I personally don't bother. I think the more practical application of that rule is to save yourself from expenses that happen right after you open the HSA.
Consider:
1) You open an HSA, you have like $100 in it.
2) You immediately get in an accident and have a $5,000 medical bill.
The solution is to just pay the bill now with after-tax money, and then after your HSA gets up to > $5,000 reimburse yourself for it. You've now essentially paid the bill with tax-free money, just several months later.
Do HSA contributions reduce FICA?
FICA Tax Implications. If you contribute to your HSA through a payroll deduction, the money is excluded from both income taxes and FICA taxes. ... In contrast, if you make a contribution on your own, your W-2 will show that $1,000 of income but you get to claim the contribution as an income tax deduction.Nov 27, 2010
https://www.sapling.com/7563658/employee-contributions-hsa-subject-fica
So, if it is funded through payroll deduction, you eliminate both FED taxes and FICA taxes.
And save all your medical receipts and use them in later years after you have grown the HSA stache to harvest tax free money.
I think there's a lot of confusion about that question. It seems like it might make a difference if your plan is a "Cafeteria plan" or not:
https://www.bogleheads.org/forum/viewtopic.php?t=151121