A Health Savings Account (HSA) is an account that you can put money into to save for future medical expenses. There are a number of advantages to funding these accounts, including;
Lower medical premiums: As HSA accounts have a higher deductible, you should be able to reduce your premium costs.
Tax savings: An HSA provides three tax advantages. 1) tax deductions when you contribute to tyhe account 2) tax free accumulations through investments 3) tax free withdrawls for qualified medical expenses.
You maintain control: 1) how much money you deposit into the account 2) choose to pay for current or future medical expenses 3) which company will hold the account 4) select what investments the account will hold.
HSA's are portable: If you change jobs, become unemployed, move cities or get divorced, your HSA account follows you. Health Savings accounts are a great way to pay for "qualified medical expenses", permitted under the tax code. These include most medical care and services, dental and vision care and most over the counter drugs.
In 2008 you can contribute up to $2900 (single) and $5800 (family) Individuals over age 55 can contribute an additional $900. For more information, contact Quotebroker or your tax professional.