A Health Savings Account (HSA) is designed to help individuals with a High Deductible Health Plan (HDHP) save for qualified medical expenses on a tax-advantaged basis.  An HDHP is a health insurance plan that generally offers lower premiums in exchange for a higher deductible.  Individuals can save by contributing money saved on premiums to their HSA and then using the money to pay for medical expenses. 

Benefits of a Health Savings Account

Triple Tax Savings

• Tax deductions when you contribute to your account
• Tax free earnings through investment
• Tax free withdrawals for qualified medical expenses

Consult your tax advisor about the tax benefits applicable to Health Savings Accounts.  Qualified medical expenses are defined under Section 213(C) of the IRS Code.  For more detail to the IRS Publication available about Medical and Dental Expenses go to www.irs.gov/pub/irs-pdf/p502.pdf

Protection

You will have an opportunity to save money to pay high or unexpected medical bills.

Affordability

High health insurance policy deductibles mean lower premiums.

Savings

You can save the money in your account for future medical expenses and grow your account through investment earnings.

Flexibility

You can contribute at anytime during the year, and your HSA balance rolls over from year to year.

Portability

You own the account, so it goes where you go, regardless of any job changes.

Ownership

Funds remain in the account from year to year, just like an IRA.  There are no
”use it or lose it” rules on your HSA.   

Who Can Have Health Savings Account?

Any adult can contribute to an HSA if they:

• Have coverage under an HSA-qualified "high deductible health plan" (HDHP)
• Have no other first-dollar medical coverage
• Are not enrolled in Medicare
• Cannot be claimed as a dependent on someone else's tax return