Considering a Health Savings Account_ _HSA_ - Avidia Bank

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Considering a Health Savings Account_ _HSA_ - Avidia Bank Powered By Docstoc
					     Considering a
Health Savings Account?
Basic HSA Plan Concept
               High Deductible health Plan
               Single     Family    Single     Family
               2012        2012     2013        2013

Min.           $1,200     $2,400   $1,200      $2,400
Deductible                                              Covers illness or injury after
                                                        the deductible, and certain
Max. Out       $6,050    $12,100   $6,050     $12,100    preventive care services at
of Pocket*                                                    no cost to you

                                                          Pays for Qualified
                 Health Savings Account                 Medical Expenses not
Contribution            Single            Family        covered by the Health
     2012               $3,100            $6,250

   *Out-of-pocket includes deductible & co-insurance
HSA Eligibility
Covered by qualified high-deductible health
 plan (HDHP)
Not covered by any other non-HDHP
Not claimed as a dependent on another
 person’s tax return
Not enrolled in Medicare

*Section 152 of the IRS Code excludes spouses from the definition of
What is the catch-up contribution?

Accountholders who are age 55                 Year             Catch-up Amount
 or older and not enrolled in
 Medicare can make catch-up                   2012                   $1,000

 Note: Spouses of accountholders who are 55 or older and meet the IRS eligibility
    requirements can open their own HSA and make a catch-up contribution
   What are Qualified Expenses?
A Qualified Expense is generally a medical
 expense incurred for you, your spouse or
 your dependents.
A complete list is provided in the IRS
 Publication 502

    Please consult a qualified tax advisor with questions
   Other eligible medical expenses

Premiums for long-term care insurance
  Limited to amount listed in 213 (d) (10)
Premiums for “COBRA”
Premiums for coverage while receiving
 unemployment compensation
Premiums for individuals over age 65
  Retirement health Plan Premiums
  Medicare Premiums
Tax Treatment of HSAs

For Employees / Accountholders
  Exclude (pre-tax) or
     Deducted (after tax) from
     Federal taxable income
   HSAs grow in the same tax-deferred manner as IRAS
Tax Treatment of HSAs (Continued)
For Employees/ Accountholders
 Distributions
   Withdrawals for qualified medial expenses are always
    tax-free. After age 65, funds may be withdrawn for any
    reason without penalty, subject to regular income tax.
 Upon death of accountholder
   If the spouse is the beneficiary, the HSA may transfer to
    the spouse’s name and remain a tax-favored account
   If the beneficiary is not the spouse, the funds are paid to
    the beneficiary as a taxable transaction
      If the HSA does not have a beneficiary, the funds are paid to the
       estate of the accountholder.
               HSAs, HRAs, FSAs
                  HSA         HRA         FSA
 Account        Employee    Employer    Employee
 Funding        Employee,   Employer    Employee,
                Employer,                Possible
                  Other                 Employer
 Roll Over         Yes      Generally      No
Year-to-Year                  No
 Portable          Yes      Generally      No
Advantage of an HSA
For an Employee
Funds roll over year to year
  No need to “use it or lose it”
Tax benefits on the contributions, earnings,
 and distributions
  Potential for increased take-home pay
Long-term investment opportunity
             Thank You

If you have questions or need assistance
    contact us at 800-508-2265 or email

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