Health Savings Account (HSA)
HSAs are an excellent way of paying for health care and saving money. They provide considerable tax savings while reducing health insurance costs.
HSAs may also be used to supplement income at retirement in case of a disability.
Two Components of the HSA
||This is your health insurance. Your deductible must be satisfied before the insurance plan will pay your claims. This deductible applies to all medical and prescription expenses – the only exception is preventive care.
||Funds are deposited in a qualified Health Savings Account with your financial institution. Money in your HSA Account may be used to pay your deductible and other IRS qualified expenses.
Key HSA Attributes…
- Employee owned
- Contributions are tax deductible, subject to IRS regulations
- HSA Funds can be used for broadly defined medical expenses
- Funds grow on a tax-deferred basis
- Unused funds can roll-over and grow tax deferred year-to-year
- Over the life of an HSA, you can save thousands of dollars in taxes
- Minimum deductible levels are set each year by the IRS
- Both employee and employer can make tax free deposits into the HSA
- It is possible to deposit more money each year than the amount of your annual deductible
- After age 65 – funds are available for any purpose (subject to taxation) or for qualified medical expenses (tax free withdrawal)
Click here for a HSA Real Life Example (.PDF Format)
© All rights reserved 2008 — 2017. Benefit Connections. (717) 258-5599
Site designed by greentdesign