Individual Health Savings Account (HSA)

A Health Savings Account (HSA) allows you to save for medical expenses and gain potential tax advantages. Paired with a high-deductible health plan, the HSA provides you with a tax-free way to pay for current and save for future medical expenses such as physician visits, prescription drugs, and more.

Account Details

Eligibility

To qualify for a HSA, you:

• Cannot be claimed as a dependent on someone else’s tax return.
• Cannot be covered under another health insurance plan, including Medicare coverage (with certain exceptions).
• Must be enrolled in a high-deductible health plan (HDHP) that does not cover all medical expenses.

Annual Contribution Limits

• Contribute up to $3,850 for self-only coverage.
• Contribute up to $7,750 for family coverage.
• If you are age 55 or over, you may make an additional contribution of $1,000 as a catch-up contribution.

Tax Advantages

• All earnings are tax-free, compounding to help your account grow over time.
• Withdrawals for qualified medical expenses are tax-free, and, at age 65, all nonmedical withdrawals are taxed at your current tax rate, similar to a Traditional IRA.

Portability

• A HSA is fully portable. Just as with your IRA, you own the account and can roll it over to another HSA custodian (subject to some restrictions).