Like the name suggests, HSAs are tax-deductible savings accounts specially designed to help employees with high deductible health insurance plans set aside money for out-of-pocket medical bills.
What is a High Deductible Health Plan (HDHP)?
An HDHP has a higher annual deductible than typical health plans, and a maximum limit on the total annual deductible and out-of-pocket medical expenses that you must pay for covered expenses.
How an HSA works
Make a monthly pre-tax contribution (this is automatically deducted from your paycheck) into your HSA for healthcare expenses. When you, your spouse and your dependents need money to pay for healthcare expenses, use your HSA debit card or checks. It’s that simple!
Benefits of an HSA
- You can claim a tax deduction for contributions you, or someone other than your employer, make to your HSA (even if you don’t itemize your deductions on Schedule A, Form 1040 or 1040-SR)
- Contributions to your HSA made by your employer can be excluded from your gross income.
- Your money stays in the account until you need it, rolling forward each year, so you never lose what you’ve saved.
- The interest/dividends or other earnings on the account are tax free.
- When you pay for qualified medical expenses, your withdrawals are tax free.
View of full list of qualified medical expenses in IRS Publication 969: irs.gov/publications/p969#en_US_2019_publink1000204145. - An HSA stays with you if you change employers or leave the work force.
Annual HSA Contribution Limits*
Set each year by the IRS, the amount you (or any other person can contribute to your HSA) depends on the type of HDHP coverage you have, your age, the date you become an eligible individual, and the date you are no longer an eligible individual.
About Verve’s Partner HSA
- Your HSA funds stay right here at Verve (no national provider).
- Serviced by a local team.
- View your balance with online banking.
- Pay yourself or your providers with online bill pay, phone and debit card access to your funds.
- Accumulate unused savings from year to year.
- Earn dividends on balances.
- No enrollment or annual fees.