A Health Savings Account (HSA) from First American Bank is a great way to save for your health care deductible, while taking advantage of tax savings.
What is an HSA?
A Health Savings Account is a tax-exempt trust or custodial account which you use to pay qualified medical expenses for you and your family.
Who is Eligible for an HSA?
To be eligible and qualify for an HSA, you must meet the following requirements:
- You are covered under a high-deductible health plan (HDHP) on the first day of that month;
- You are not covered under another type of health plan that is not an HDHP (certain exceptions apply);
- You are not enrolled in Medicare (generally, are under 65 yrs. old); and
- You may not be claimed as a dependent on another individual's tax return.
Why Choose an HSA?
- The HDHP generally costs less than traditional health care coverage. Money saved on the insurance premium can be put into the HSA.
- Contributions to your HSA are tax deductible.
- After age 65, HSA funds can be used for non-qualified expenses without penalty. Only income tax is assessed.
- Use the pre-tax funds in your HSA to pay for current medical expenses or expenses that your insurance may not cover including dental expenses, vision care, Medicare expenses, and long term care. See publication 502 on the IRS website for a complete list of qualified expenses.
- Save the money in your HSA for future medical expenses.
- No use it or lose it philosophy - the HSA funds remain in the account from year to year. Even if your HSA compatible coverage ends, you can still use the funds tax free for qualified medical expenses.
- You are in control of your HSA. Funds belong to you even if you switch jobs, become unemployed, or change your medical coverage.
- Review our Frequently Asked Questions for more details.