Just What The Doctor Ordered
A health savings account (HSA) is a tax-advantaged medical savings account you can use to pay for qualified medical expenses. An HSA is a great tool for individuals, and families, enrolled in a qualifying high deductible health plan (HDHP) to pay for current health expenses and save for future medical and retiree healthcare expenses on a tax-free basis. Unused funds remain in the HSA to grow for use in future years.
Contributions can be made by you, your employer, or other individuals
Pay For Expenses
Funds used to cover expenses related to your High Deductible Health Plan until you meet your deductible.
Funds will not be taxed if used for qualified expenses
At year-end, remaining funds carry over for use in future years. No “use it or lose it” rules (like flex savings accounts)
The money is yours! Your health savings roll over from year to year with no limits or penalties
Your savings continues to grow through contributions and dividend earnings
Build Your Health Savings
A Health Savings Account is a great way to build your savings that can be used for health related expenses for you and your family.
- Interest paid on account balance
- NO minimum to open
- NO minimum balance requirement
- NO monthly maintenance fee
- Federally insured by NCUA
2020 Contribution Limits
- Self-only Coverage: $3,550 Annual Contribution Limit
- Family Coverage: $7,100 Annual Contribution Limit
You own your HSA. The money is yours even if you switch jobs, retire, or move out of a high deductible health plan.
HSA Frequently Asked Questions
Your HSA funds are available to pay for qualified medical expenses. Those expenses the IRS has determined to be “qualified” are listed in Publication 502 and defined in IRC Section 213d.
Conveniently pay for your qualified medical expenses, including prescriptions, doctor visits, and other health-related purchases with your AFFCU HSA Visa® Debit Card. You may also make payments via other methods and reimburse yourself by transferring funds from your HSA account via online and mobile banking.
Contributions can be deposited to your HSA from several sources.
- Employer Contributions: If the HSA is offered through your work, your employer may elect to contribute funds to your account on a pre-tax basis. Amounts are determined by your employer from year to year.
- Payroll Deduction/Direct Deposit: Pre-tax contributions may be deducted from your paycheck and deposited directly into your HSA account.
- Catch up Contributions: Those age 55 and older are eligible to contribute additional funds above the annual IRS limit, up to $1,000.
- Personal Funds: You may deposit personal funds to your account. Such deposits are completed on a post-tax basis and then are deducted on your Federal 1040 tax filing to achieve pre-tax status.
To be eligible for an HSA you:
- You must be covered by a high deductible health plan (HDHP)
- You cannot be enrolled in Medicare
- You cannot be covered by a non-HDHP
- You cannot be claimed as a dependent on someone else’s tax return for the previous year
Please consult with your HR department and tax advisor to determine if you are eligible for an HSA and if it is a good fit for your needs.
You will need to complete IRS Form 8889 to be filed with your Form 1040 income tax filing each year, whether you itemize your deductions or not. This form reports your deposits and withdrawals from the HSA account. AFFCU will send out all appropriate tax related documents annually. For specific assistance with tax reporting of your HSA account, please see your personal tax advisor.