Health Savings Account (HSA)
Not all HSAs are created equal
If your employer provides you with a qualifying High Deductible Health Plan (HDHP), or if you are going to obtain one yourself, you will want a Health Savings Account (HSA) to go with it. The money that you, and possibly your employer, contribute to your HSA can be used tax-free for qualified medical expenses not covered by the HDHP, including the deductible. Unitus offers a Health Savings Account that pays highly competitive rates, and it comes with an HSA debit card that makes it simple to use.
An eye to the future
In addition to helping with current medical expenses, your HSA is designed to help you save for medical expenses that are not covered by Medicare after you retire. HSA funds do not expire; they grow tax-free through dividend earnings, just like an IRA. Unitus pays very attractive HSA rates that get higher as your balance grows. Check our current rates at unitusccu.com or give us a call.
You are in charge
The money in your HSA is yours, and you alone decide how to use it. However, HSA funds used for anything but qualified medical expenses are subject to taxation and a 20% penalty.
It is up to you to determine whether you are paying for a qualified medical expense and to keep appropriate records for the IRS. (Qualified medical expenses are partially defined in IRS Publication 502.)
Tax advantages of HSAs
- Your contributions to your HSA can usually be deducted from your taxable income. (Please check with your tax advisor.)
- The dividends you earn in your HSA grow tax-free.
- You may use your HSA funds tax-free for qualified medical expenses.
For the most current information on annual HSA contribution limits for those with individual and family HDHPs, please visit the IRS website. Once you reach age 55, you can make an additional "catch-up" contribution each year until you enroll in Medicare. When you enroll in Medicare, you can no longer make contributions to your HSA.
Using your Unitus HSA
Your Unitus HSA comes with a debit card you can use worldwide—anywhere that Visa debit cards are accepted—to pay for qualified medical expenses at health facilities, pharmacies, and so on. You can also use your card to pay bills that accept payment by Visa, and order checks to use with your HSA.
How to get started
To learn more about a Health Savings Account, or to get started, please drop by any Unitus branch or give us a call. We can also setup an automatic payroll deduction to fund your HSA.
Please note: Unitus Community Credit Union does not provide tax advice, and nothing in this section should be construed as tax advice. Before acting on this information, consult your own accountant or tax advisor.