Who can qualify for an HSA?
Anyone with a qualified High Deductible Health Insurance plan - individuals, employers and employees. (Certain exceptions apply, including Medicare)
Who can contribute to an HSA?
Individuals, employers and their employees.
How much can be contributed to the HSA in 2004?
The lesser of the deductible or $2,600 for a single person and $5,150 for a family per year. Amount is prorated determined by the date you sign up.
Use this tool to calculate your Maximum 2004 HSA Contribution.
What can HSA funds be used for?
The funds belong to the individual or employee. Funds can be withdrawn for any purpose. However, if withdrawn for non-qualified medical expenses by someone under age 65, the amount withdrawn is taxable and subject to a 10% penalty by the IRS. After age 65, there is no penalty for non-qualified withdraws but amounts are taxable.
Is an HSA allowed for those small business owners who are not eligible for an HRA (Health Reimbursement Account)?
Yes. An HSA is allowed for any small employer regardless of ownership.
What is the cost to set up an HSA?
There is a one time $25 set up fee and a $2.25 per month maintenance fee. Fees are non-refundable.
How do I set up a Health Savings Account?
You need to determine if you have a qualifying High Deductible Health Insurance plan and if you do you will need to complete the Health Savings Account Application and sign the HSA Bank Custodial Agreement.
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How is a Health Savings Account processed?
Your money starts growing from day one. Your deposits are placed in your HSA. Your account earns tax-deferred interest. Mutual Fund investment options are also available.
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1. TAX SAVINGS
Federally Qualified HSA contributions can be deducted from your gross income on your federal tax return, even if you do not itemize deductions.
Many states also allow the deduction from state income taxes.
2. TAX DEFERRED INTEREST & EARNINGS
Funds left to accumulate in your HSA can grow with tax deferred interest and earnings.
3. REDUCED INSURANCE PREMIUMS
Your insurance premiums are usually lowered by 20%-40% when you change from a low deductible to a high-deductible plan.
You can use these savings to fund your HSA.
4. PORTABILITY
Even if you change jobs, your HSA funds go with you.
You own your account.
5. LONG-TERM SAVINGS
You can choose to let the funds in your account grow tax-deferred.
After age 65, you may make withdrawals from your HSA for any reason without a penalty.
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