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Health Saving Account1 Questions and Answers Graded A+
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Health Saving Accounts (HSAs)What is Health Saving Accounts - answer A Health Savings Account (HSA) is to pay
or reimburse certain medical expenses you incur.
You must be an eligible individual to qualify for an HSA.
You set up an HSA with a trustee。e.g. bank
What are the benefits os Health Saving Accounts - answer 1. You can claim a tax
deduction for contributions you, or someone other than your employer, make to your
HSA even if you don't itemize your deductions on
Schedule A
2. Contributions made by your employer *may be excluded*from gross income.
3. The interest or other earnings on the assets in the account are tax free.
4. Distributions may be tax free if you pay qualified medical expenses.
5. HSA is portable while you change employer
Who qualifies for HSAs - answer To be an eligible individual and qualify for an HSA,
you must meet the following requirement
1. You are covered under a high deductible health plan (HDHP), described later, on the
first day of the moth.
2. You have no other health coverage
3. You canot be enrolled in Medicare
4. You can't be claimed as a dependent on someone
Under *the last-month rule*, you are considered to be an eligible individual for the entire
year if you are an eligible individual on the first day of the last month of your tax year
(December 1 for most taxpayers).
Contributions to an HSA - answer 1. For employee HSA, both employees and
employer can contribute
2. For self-employed, family member can contribute
3. Contributions to an HSA must be made in *cash*.
Limit on Contributions - answer If you have self-only HDHP coverage, you can
contribute up to $3,400. If you have family HDHP coverage, you can contribute up to
$6,750.
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