Health Savings Account FAQs
Health Savings Accounts (HSAs) were signed into law on December 8, 2003.
An HSA is money in an account owned by an individual and funded with money to pay for future medical expenses.
An HSA works like an IRA, except the money is used to pay for qualified health care costs. Money deposited to the account may be tax deductible and is used to pay for current and future qualified medical expenses. Interest earned is tax deferred. Unused balances rollover from year to year.
Anyone with a high deductible health insurance plan is eligible for an HSA provided they are not covered by another health insurance plan, entitled to Medicare or can’t be claimed as a dependent on someone else’s tax return.
For single coverage, contributions are limited to $3,600. For family covered plans, contributions are limited to $7,200. Those 55+ of age, you may contribute an additional $1,000.
Consult your tax advisor regarding the tax benefits of the HSA product.