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Employer Overview - Considering a Health Savings Account _HSA_

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Employer Overview - Considering a Health Savings Account _HSA_ Powered By Docstoc
					     Considering a
Health Savings Account?
         (HSA)
  Basic HSA Plan Concept
                   High Deductible health Plan
               2010             Single            Family
          Min. Deductible       $1,200            $2,400
                                                             Covers illness or injury after
          Max. Out of           $5,950            $11,90
                                                             the deductible, and certain
  HSA     Pocket
                                                              preventive care services at
Concept
                                                                   no cost to you
                         Health Savings Account
          Contribution           Single           Family
                                                               Pays for Qualified
               2010             $3,050            $6,150     Medical Expenses not
                                                             covered by the Health
                                                                     Plan.
     *Out-of-pocket includes deductible & co-insurance
  *Qualifying deductible ranges are limited by the maximum
                        out-of-pocket
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
   dependent.
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                   2010                   $1,000
        contributions




 Note: Spouses of accountholders who are 55 or older and meet the IRS eligibility
    requirements can open their own HAS 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
 http://www.irs.gov/pub/irs-pdf/p502.pdf

    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
Contributions
  Exclude (pre-tax) or
     Deducted (after tax) from
     Federal taxable income
Earnings
   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
 Owner
 Funding        Employee,   Employer    Employee,
                Employer,                Possible
                  Other                 Employer
 Roll Over         Yes      Generally      No
Year-to-Year                  No
 Portable          Yes      Generally      No
                               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
           hsa@avidiabank.com

				
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posted:1/12/2011
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