Here’s a “Top Ten” list of reasons why employers and employees should establish Health Savings Accounts (HSAs).
10. HSA-eligible high-deductible health plans can save premiums for both employers and employees.
9. HSAs belong to the account holder and are retained by the participant when changing jobs.
8. HSA contributions are non-taxable.
7. HSA growth through interest and dividends is non-taxable.
6. Disbursements for qualified medical expenses are non-taxable.
5. There is no dollar limit to the amount that may accumulate in an HSA.
4. The maximum annual contribution may be deposited into an HSA even if it is established mid-year.
3. HSAs roll forward from year to year. Funds can accumulate for expenses incurred during retirement.
2. Anyone, including both the employer and the employee, can contribute to an individual’s HSA during the year
- HSA’s indexed figures are released earlier than any other benefits’.
This table shows the the 2020 HSA limits.
Congress mandates that cost-of-living adjustments for HSAs must be released by June 1 of every year. The early release of HSA minimums and maximums each calendar year ensures that plan sponsors and their employees have ample time to review plan design options and prepare brochures and educational materials ahead of open enrollment.
Find out more information on HSAs at: https://www.wageworks.com/employer/health-care/Health_Savings_Account/default.htm.
The information contained in this article is not intended to be legal, accounting, or other professional advice. We assume no liability whatsoever in connection with its use, nor are these comments directed to specific situations.