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Health Savings Account -- A Health Savings Account (HSA) is an account that you can
put money into to save for future medical expenses.
Who Can Have an HSA -- Any adult can contribute to an HSA if they:
- Have health insurance coverage under an HSA - qualified "high deductible"
health plan (HDHP)
- Have no other first-dollar medical coverage (other types of insurance
like specific injury insurance or accident, disability, dental care, vision
care, or long-term care insurance are permitted)
- Are not enrolled in Medicare
- Cannot be claimed as a dependent on someone else's tax return
Advantages of HSAs
- Tax Savings
- Tax deductions when you contribute to your account
- Tax-free earnings through investment
- Tax-free withdrawals for qualified medical expenses
- Savings
- You can save money in your account and grow it with investment earnings
- Affordability
- You should be able to lower your premiums with a high deductible plan
- Flexibility
- You can use the funds in your account to pay for current medical expenses or save the money in your account for future needs
- Control
- You can make all the decisions about the account; how much to put in, whether to use now of save for the future, who will hold the account and how to invest the funds
- Portability
- Accounts are completely portable, meaning you can keep your HSA even if you: change jobs, change your medical coverage, become employed, move to another state or change your marital status
- Ownership
- Funds remain in the account from year to year, just like an IRA. There is no
"use it or lose it" rule
- Affordability
- You should be able to lower your premiums with a high deductible plan
- Security
- Your high deductible insurance and HSA protect you against high or unexpected medical bills
Features and Benefits
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