So What is an HSA?
Simply put, a Health Savings Account—HSA for short—is exactly that: A type of savings account that is used for eligible medical expenses.
With an HSA, over time account holders have the opportunity to accumulate large balances that they can take with them into retirement to use to pay for their retiree medical expenses tax free.
What are the Requirements for an HSA?
In order to open and contribute to an HSA an individual must meet the following requirements:
- Must be enrolled in an HSA Qualified Health Plan.
- Cannot be enrolled in any Nonqualified Health Insurance Plans.
- Cannot be enrolled in Medicare.
- Cannot be claimed as a dependent on someone else’s tax return.
If you're unsure if you qualify for an HSA give us a call and we can help! Call: 1-800-57-MyHSA
What do I do with an HSA?
The HSA account holder can use the money in their account to pay for their own qualified medical expenses and the qualified medical expenses of their spouse and any eligible dependents.
The money not spent in an HSA account by the end of the year stays in the HSA account and the account holder continues to have access to those funds to pay for future qualified medical expenses.
What Items are Considered Qualified Medical Expenses?
HSA account holders can use the money in their HSA to pay for their own qualified medical expenses and the qualified medical expenses of their spouse and any eligible dependents tax free. Below is a partial list of Qualified Medical Expenses.
- Annual physical examination
- Contact lenses
- Hearing aides & batteries
- Laboratory tests
- LASIK eye surgery/vision correction surgery
- Nursing home and services (including board and meals)
- Orthopedic shoes
- Over-the-counter items (certain items)
- Prescription medicines
- Stop-smoking programs
- Therapy equipment
For a complete list of Qualified Medical Expenses please refer to IRS Publication 502.
How much can be Contributed to an HSA?
Contributions to HSAs can be made by both the employer or the individual account holder. Contributions can also be made by others on behalf of an eligible individual and deducted by the HSA account holder.
The maximum amounts allowed for contributions can change from year to year. Below are the most recent yearly amounts provided by the IRS. However, changes can occur at any time.
For the most up-to-date information, please refer to IRS Publication 969 for any recent changes that may not be reflected here.