American workers are hearing more buzz surrounding Health Savings Acounts (HSAs) with each passing year. And for good reason. As more employers and employees alike begin to fully understand the benefits of an HSA, many speculate that the utilization of this benefit will continue to flourish.
So, What’s an HSA?
A type of savings account that allows you to set aside money on a pre-tax basis to pay for qualified medical expenses.
Can anyone get an HSA?
In order to open an HSA, an individual must first enroll in a qualified high deductible health plan (HDHP).
What can I pay for with my HSA?
Generally, HSA funds can be used to pay for anything that your insurance plan considers a “covered charge,” including charges not paid by your health insurance because they were subject to a co-pay, deductible,
or coinsurance.
I’ve heard HSAs have triple-tax-advantages. What are they?
- Contributions are tax free.
- Contributions can be invested and grow tax free.
- Withdrawals aren’t taxed, if used for qualified medical expenses.
Do I lose my HSA funds at the end of the year?
No. The balance can grow and carry from year to year and can also be invested.
If I change employers, what happens to my HSA?
HSAs are completely portable for employees, meaning you may take it with you if you change employers.
