Health Savings Accounts
A Health Savings Account (HSA)is used in conjunction with a high deductible health care plan (HDHP)*. The money deposited into your account allows you to pay for current eligible health care expenses, and save for future qualified medical expenses. This may also provide for tax savings as described below. Golden Eagle Community Bank’s HSA account is an interest bearing account, which can be conveniently accessed through the use of a debit card to pay for qualified medical expenses.
Who Qualifies?According to the Medicare Act of 2003, which establishes HSAs, "eligible individuals" are:
- Those who are covered under a qualified high deductible health plan (HDHP) on the first day of that month.
- Those who cannot be claimed as a dependent on another’s tax return.
- Those who are not covered by another health care plan.
- Those not enrolled in Medicare.
Tax Savings**- An HSA may provide you with triple tax savings, (1) tax deductions when you contribute to your account; (2) tax-free earnings through investment; (3) and tax-free withdrawals for qualified medical expenses.
Flexibility- You can use the funds in your account to pay for current medical expenses, including expenses that your insurance may not cover, or save money for future medical needs. See publication 502 on the IRS website for a complete list of qualified expenses.
Cost savings- With an HSA, the high deductible health care plan is generally lower than that of a traditional health insurance policy.
Portability- Unused funds remain in your account from year to year just like an IRA, whether you change jobs, medical plans, retire, or become unemployed.
Getting started- If you are eligible for an HSA, contact a Golden Eagle representative about current interest rates and how to open or transfer your existing account.
For additional information on High Deductible Health Care Plans and Health Savings Accounts, go to www.irs.gov.
*An HDHP is a health insurance plan with lower premiums and higher deductibles than a traditional health plan. Being covered by an HDHP is a requirement for having a health savings account.
**Golden Eagle does not provide tax advice. Please contact your tax advisor.