Health Savings Account (HSA)
An HSA is an effective way to provide for your physical health and financial health while reducing your tax payments. That's three life-changing benefits packed into one simple account.
Start saving now to reap the most tax benefit. And the next time you need medical care, you'll have the funds set aside.
- Contributions are tax free or tax deductible*
- Interest grows tax free
- Withdrawals are tax free when used for qualified medical expenses**
- Money rolls over year-to-year automatically
- HSA is owned by you, not employer
- Low $25 annual fee
- Easy withdrawal access by check, online, teller
- $25 minimum deposit to open
- FDIC insured
*Direct deposit contributions from paycheck mean that portion of your income is not taxed. If contributions are made after income was taxed, the amount deposited is tax deductible.
**Withdrawals for non-qualified medical expenses are subject to income tax and a 10% penalty. The 10% penalty is waived for persons 65 and over or who have become disabled.
- Must be covered under a qualified, high deductible health plan
- Must not have coverage by another type of health plan
- Cannot be claimed as a dependent on another person's tax return
- Cannot be enrolled in Medicare
Contribution limits are set by the IRS. Current 2011 contribution limits are:
- $3,050 for a single person
- $6,150 for a family
- A person age 55 or older may make an additional $1,000 in "catch-up" contributions