Save Tax Dollars with a Health Savings Account

Posted on May 4, 2012. Filed under: Joan Popp, NMLS #501065 |

Benjamin Franklin said “The only things certain in life are death and taxes.”  I think we could add continually rising health care premiums to this old quote.  Every year premiums increase and employers look for ways to lower their health care expenses.  Many companies have gone to high-deductible health plans (HDHP) for their employees.  People with family coverage could be dealing with out of pocket medical expenses of $2,400.00 or more per year.  One way to help budget for these medical expenses when you are covered by a HDHP is to open a Health Savings Account (HSA).  Some of the benefits of an HSA are: 

1) The contributions you make to your health savings account are tax deductible; 2) The earnings grow tax deferred; 3) Distributions to pay or reimburse yourself for qualified medical expenses for yourself, your spouse, or your children are tax free.  One of the best features of this account is, if you don’t have medical expenses now, you can just leave the funds grow and accumulate for use later in life or in retirement.  Some other health benefit plans require you to use the funds you set aside for medical expenses each year or you lose them. 

The HSA’s at Denmark State Bank earn interest and have no maintenance fees.  You can pay for your medical expenses with checks or you can use the debit card provided to you specifically for this account.

Check with your insurance agent to see if your health plan is eligible for an HSA.  If yes, open and start funding your HSA today!  Qualified medical expenses are not qualified unless they occur after your HSA is opened.  HSA contributions can be set up through payroll deduction, auto transfers, or normal deposits.   Funding your HSA is a great way to reduce the amount you have to pay to the IRS.  

For more information, contact us at www.denmarkstate.com or stop at any of our convenient locations.   You’ll be glad you did!

Denmark State Bank does not provide legal, tax or investment advice to Health Savings Account holders. Contact a qualified accountant, attorney or investment advisor for legal, tax or investment advice. Federal law sets the minimum requirement for what constitutes a HDHP.

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