A Health Savings Account (HSA) is a tax-favored account used in conjunction with an HSA-compatible health plan. The HSA allows you to contribute funds on a pre-tax or tax-deductible basis, which you may use to pay for eligible medical expenses.
It's easy to determine if you are qualified for a Health Savings Account (HSA).
You are qualified for an HSA if:
• You are covered by a single or family high-deductible health plan (HDHP).
• You are not covered by any other health plan, unless it is also a HDHP.
• You are not enrolled in Medicare.
• You cannot be claimed as a dependent on another person’s tax return, excluding your spouse.
To enroll in an HSA, you must have a primary U.S. residence as well as a valid Social Security Number.
An eligible medical expense is an expense that pays for healthcare services, equipment or medications as described in IRS Publication 502.
IMPORTANT: In 2011, your Health Savings Account (HSA) may no longer be used for over-the-counter drugs, unless they are prescribed by your doctor.
In general, your HSA can be used for:
|2013 IRS Limits||2014 IRS Limits|
|Single Plan||Family Plan||Single Plan||Family Plan|
|Maximum Contribution Limit||$3,250||$6,450||$3,300||$6,550|
|Catch-up Contribution (55 )||$1,000||$1,000||$1,000||$1,000|
HSA-compatible Health Plans
The IRS sets annual requirements for the minimum deductible and maximum out-of-pocket expense for HSA-compatible health plans. Verify with your health plan representative that your health plan is compatible.
Individuals age 55 and over can make catch-up contributions directly through Internet Banking or by mailing a personal check.
If you exceed the maximum contribution amount for a given year, you can remove the excess funds by your tax filing deadline, typically April 15, without tax penalty. To remove an excess contribution, please complete the Excess Contribution Removal Form and mail it to HSA Bank.
If excess funds are not removed by your tax filing deadline, you may be subject to tax penalties and/or IRS fees.
You may be eligible for a one-time rollover from your FSA or HRA as long as you meet the conditions and eligibility requirements. Per IRS Notice 2007-22, you must:
1) have had an FSA or HRA on September 21, 2006;
2) roll over the lesser of the balance in the FSA or HRA on September 21, 2006 or as of the date of the distribution; and
3) bring the FSA or HRA balance to zero. Contact your employer who will need to initiate the rollover process by contacting the FSA or HRA administrator. For more information, reference IRS notice 2007-22.
A one-time rollover from an IRA is allowed up to the annual IRS maximum amounts. Contact your tax advisor to discuss the benefits and tax reporting requirements.
Long-term Investment Opportunities
HSA Bank is a Milwaukee-based company and one of the nation’s leading Health Savings Account (HSA) administrators. They serve more than 425,000 accountholders with more than a billion dollars in HSA assets. They focus solely on the administration, service and support of HSA products.
HSA Bank is one of the most experienced HSA administrators in the country.