Health Savings Account (HSA) Tax Benefits: Who Qualifies and What You Get
Learn how you can use a Health Savings Account to save money on medical expenses through significant tax advantages.
A Health Savings Account (HSA) is a way to set aside money for medical costs while receiving specific tax advantages.
Who it's for
To qualify for this benefit, you must be enrolled in a High Deductible Health Plan.
What you get
You receive what is known as a "triple tax advantage." This means the money you put into the account is not taxed, any growth the money earns is not taxed, and when you take money out to pay for medical expenses, that withdrawal is also tax-free.
What it costs you
There is no direct fee to participate, but you are responsible for managing the account through a bank or a financial institution.
The catch to know
Unlike some other medical savings accounts, your funds do not expire at the end of the year. The money stays in your account for future use.
How to apply
- Ensure your health insurance is a High Deductible Health Plan.
- Choose a bank or financial institution that offers HSA accounts.
- Open your account and begin making contributions.