An HSA is a tax-exempt account established primarily for the purpose of paying qualified medical expenses. Most people covered under an IRS-qualified High-Deductible Health Plan (HDHP) can open and contribute to an HSA.
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An HSA is a personal savings account that can be used to pay for medical, dental, vision and other qualified expenses now or later in life. To contribute to an HSA you must be enrolled in a qualified high-deductible health plan. Your contributions are tax deductible but are limited annually. If your employer offers payroll deduction, you’ll see immediate tax savings on your contributions.
Since it is a savings account, you are encouraged to save more than you spend. Unlike FSA funds which are “use-it-or-lose-it,” your HSA balance rolls over from year-to-year and earns interest along the way. The account is portable, which means that if you ever leave your employer, you can take the HSA with you. It’s your money and your account.
Contributing in a health savings account allows you to invest pre-tax dollars for your biggest retirement expense - HEALTHCARE.
You can continue to contribute year after year and withdrawals can be made at any point in time. Whether you withdraw the money tomorrow, five years from now, or in retirement, funds used for qualified healthcare expenses are always tax free.
*2022 Value. For illustrative purposes only. Savings calculations are based on a federal tax rate of 15%, state tax rate of 5%, and 7.65% FICA. Balance calculations assume an average interest rate of 3%. Actual results may vary.|
A contribution of $50 a month over 25 years: |
|
| TAX SAVINGS | BALANCE |
|---|---|
| $6,181 | $22,356 |
|
A contribution of $200 a month over 25 years: |
|
| TAX SAVINGS | BALANCE |
| $24,726 | $89,425 |
| Max. family contribution of $7,300 a year over 25 years: | |
| TAX SAVINGS | BALANCE |
| $75,208 | $272,000 |
If Your employer offers payroll deduction through a Cafeteria Plan, you may make contributions to your HSA on a pre-tax basis or you can contribute to your HSA post-tax and recognize the same tax savings by claiming the deduction when filing your annual taxes.
Eligible medical purchases can be made tax-free when you use your HSA. Make this easy by using your Benefits Debit Card or online bill pay. You can also pay out-of-pocket for eligible medical expenses and then reimburse yourself from your HSA.
Unlike most savings accounts, interest earned on an HSA is not considered taxable income when the funds are used for eligible medical expenses. You can also invest HSA dollars and interest earned is also tax free.
Our convenient debit card allows you to avoid out-of-pocket expenses, cumbersome claim forms and reimbursement delays. You may also utilize the “pay a provider” option on our web portal.
Get account information from our easy-to-use online portal and mobile app. See your account balance, contributions and account history in real time.
The only time you may pay taxes or penalties on your HSA funds is if you make a non-eligible purchase, or if you contribute more than the yearly maximum contribution limit. However, both circumstances can be corrected free of tax penalties by April 15th of the following calendar year.
Compare your out-of-pocket costs for an HDHP /HSA plan to a non HSA plan option.
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