Smart Savings for Your Health
Key Features
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Triple Tax Advantage
Enjoy pre-tax contributions, tax-exempt interest and investment gains, and tax-free withdrawals (for qualified medical expenses).
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Funds Rollover Year-to-Year
There is no “use-it-or-lose-it” rule for your HSA funds. Any money not used during the calendar year rolls into the following year and continues to grow.
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No Monthly Service Fee
Once you reach retirement age at 65, there is no penalty for withdrawing funds from your HSA for non-qualified medical expenses.
Frequently Asked Questions
What does “tax-advantaged” mean?
Funds in an HSA account can receive a triple-tax-advantage. Your contributions to an HSA account are considered “pre-tax” contributions – this means your HSA contributions reduce your taxable income. Interest earned on your HSA funds are not taxed while they are in your account. Additionally, qualified distributions of you HSA funds are tax-free.
What is needed to open an HSA?
- Member must be in an eligible High-Deductible Health Plan (HDHP)
- Member cannot be covered by other health insurance
- Member cannot be enrolled in Medicare
- Member cannot be claimed as a dependent on someone else’s tax return
- Children cannot establish their own HSA
- Shares cannot be pledged
Are there minimum qualifying deductibles on High-Deductible Plan?
Yes, there are minimum qualifying deductibles based on self-coverage and family-coverage. The current minimum deductible amounts can be found on the IRS website.
What are the maximum annual out-of-pocket expenses?
The maximum annual out-of-pocket expenses vary based on self-coverage, current amounts can be found on the IRS website.
What if I use my funds for non-qualified medical expenses?
If you are under age 65 and withdraw dollars from your HSA for non-qualified medical expenses, the amount will be taxed as ordinary income and you will also incur a 20 percent penalty.
Starting at age 65, there is no penalty for withdrawing funds from your HSA for non-qualified medical expenses. However, you may still need to pay income tax on the amount.