Health Savings Account
A Health Savings Account (HSA) is a tax-exempt account established exclusively for the purpose of paying the qualified medical expenses of you and your family.
How is an HSA Established?
An HSA is established by you in much the same way that you establish an IRA.
Am I Eligible for an HSA?
You are eligible to make or receive an HSA regular contribution if, with respect to any month, you:
- Are covered under a high-deductible health plan (HDHP) on the first day of such month
- Are not covered under another type of health plan that is not an HDHP (with certain exceptions for plans providing certain limited types of coverage)
- Are not entitled to benefits under Medicare (generally, have not attained age 65); and
- May not be claimed as a dependent on another individual’s tax return.
Who Can Contribute to My HSA?
If you meet the eligibility requirements for an HSA, you, your employer, and your family members may contribute to your HSA. This is true whether you are self-employed or unemployed.
How Much Can I Contribute to My HSA?
The maximum annual contribution amount is generally the lesser of 100 percent of the annual deductible under the HDHP or a specified amount.
What Are the Federal Tax Benefits of an HSA?
Contributions to an HSA are fully deductible, the earnings grow tax deferred, and distributions for qualified medical expenses are tax free. Consult with your tax or legal professional for guidance.
If you are interested in an HSA, contact a Security First Bank Customer Service Representative today.