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Health Savings
Accounts
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Health
Savings Accounts
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Health Savings Accounts, or HSAs, were
created by Congress to combat rising medical costs by providing an
incentive for consumers to pay "first dollar" medical expenses. An HSA
is an IRA-like account that is designed exclusively for covering medical
expenses. HSAs allow for
tax-deductible contributions and tax-free distributions of principal and
earnings if distributed amounts are used for qualified medical expenses. |
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Contributions into an HSA are permitted by
the employer, individual or both. To qualify for an HSA the
accountholder must have a high-deductible health plan (HDHP). |
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Businesses interested in offering this
benefit to their employees must first meet with their insurance agent
for available options. SNB&T advises you to also discuss these options
with your tax advisor. |
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Benefits to employers offering HSAs: |
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Tax deduction for contributions. |
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Lower overall health insurance costs when switching from a low to a
high deductible health plan. |
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Increased ability to attract and retain employees as a
result of providing expanded benefits. |
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Employer has flexibility in determining contribution
amount. |
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Refer to
Deposit Rates for current interest
rates. |
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For more specific account details
click here. |
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