Health Savings Accounts
What is a health savings account?
A health savings account (HSA) gives you tax advantages when you need to pay for medical expenses not covered by your individual health insurance. You can deposit money tax-free into a HSA, and even the interest you earn on the account is tax-free. You can use this account along with certain individual health insurance plans known as HSA-eligible health insurance plans. You are considered the owner of a health savings account, and there is only a fee or penalty if you decide to take money out for an expense that is not medical related.
What are the reasons why I would want a health savings account?
There are many advantages to having a health savings account. The money that you put into the account is tax-free and tax-deductible. You can use this money to pay for health expenses that are not covered by your family health insurance plans; otherwise, the money will earn tax-free interest. Some of these accounts may have a monthly fee, but others will not have any fees as long as you only use the money for health expenses.
Can I get a health savings account for my business?
You can obtain a health savings account for your business, and it is a great way to offer affordable small business insurance to your employees. You would open a business health savings account and then decide how much employees can contribute. You will also have the option to add or remove employees as needed, and even add funds to their accounts if you offer a benefits package. The employees themselves can decide to open up a health savings account and enroll in an HSA-eligible individual health plan.
How does a business health savings account work?
To have a business health savings account, the employer must sign up for one. The employer must also sign up for an HSA-eligible small business health insurance plan. Both the employer and the employees can contribute to the health savings accounts and choose the private health insurance that works best for them. If the employer chooses, they can offer employees the option to automatically contribute to their accounts through payroll deductions, and employers will also have the ability to add or remove employees as necessary.