A Health Savings Account (HSA) is an account that is used to save for and pay qualified medical expenses.

HSA – HEALTH SAVINGS ACCOUNT 

What is it?

Health Savings Account (HSA) is an account that is used to save for and pay qualified medical expenses.

  • You qualify for an HSA only if you have a high deductible health plan (HDHP).
  • You can put part of your check, pre-tax, into the HSA to pay for medical expenses that aren’t covered by your medical insurance.
  • The high deductible plan typically keeps premiums lower.
  • Both you and your employer can contribute to HSA accounts.
  • The HSA is owned by youincluding employer contributions from the time of deposit.
  • You make decisions around the use, savings, or in some cases, investment of the funds.
  • You can take your HSA with you if you change jobs.
  • Any unused funds will roll over from year to year, there is no “use it or lose it” risk. 

An HSA has a Triple Tax Advantage

  • HSA contributions are tax deductible– Contribution to HSA accounts come out of your pay check before tax is taken out which reduces your taxable income.
  • Tax free growth– Interest earned by investing HSA funds grow tax free.
  • Tax Free Withdrawals– Money used to pay for qualified medical expenses is also tax free. 

To qualify for an HSA you need to meet the criteria:

*Money that is put into the HSA can be used to pay for qualified medical expenses that insurance doesn’t cover. For example, if your individual deductible is $2,500 and you contributed the maximum allowable amount ($3,500) and you have a medical bill you could use your HSA dollars to pay for the bill.