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An HSA can reduce your health insurance premiums while you set aside funds to pay for current and future medical expenses.
HSA contributions are tax deductible (subject to limitations), and withdrawals are tax-free when used for qualifying medical expenses.
If you want to take control of your health care costs—avoiding high premiums and complicated health plans—then an HSA could be the right plan for you.
In order to establish an HSA, an individual must first be covered under a high-deductible health plan (HDHP).
Furthermore, the individual cannot be enrolled in any other type of health insurance coverage unless such coverage is considered disregarded coverage.
Disregarded coverage includes insurance related to accident, disability, vision, dental care or long-term care. This also includes insurance providing coverage regarding a special disease or illness or insurance paying a fixed amount per day for hospitalization coverage.
An individual is not eligible for an HSA if the individual is enrolled in Medicare Part D or in any other Medicare benefit program. In addition, an individual is not eligible if they can be claimed as a dependent on someone else’s tax return.
It is important to note that an HDHP can offer either self-only or family coverage. Below are contribution limits and the requirements for eligibility.
|2019 Health Savings Account (HSA) Contribution Limits|
|High Deductible Health Plan Coverage|| Standard Limit|
(under age 55)
| Catch-up Limit|
(Age 55 – 65, 65 and older if you qualify)
|Individual (Self Only)||$3,500||$4,500|
| High Deductible Health Plan |
|Individual (Self Only)||Family|
|HDHP Minimum Deductible||$1,350||$2,700|
|Annual Out-of-Pocket Expense Limit||$6,750||$13,500|
2019 HSA Contribution Deadline is 4/15/2020