Health Savings Accounts (HSAs)

• Overview
• Contributions
• Withdrawals
• Rates & Fees

You may contribute to your HSA yourself or others may contribute on your behalf. Contributions may be made to your account at any time during the year. Once funds are deposited into your account, they are yours regardless of resignation or termination.

Contribution Limits
In 2010, maximum contributions to an HSA may not exceed $3,050 for individual coverage or $6,150 for family coverage. These maximums will be adjusted annually.

Excess Contributions
Contributions made in excess of your allowed limit will generally be charged a 6% excise tax. However, if you withdraw funds prior to April 15 of the following year, you may only have to pay income tax on those additional funds.

Funding an HSA with After- or Before-tax Dollars
HSA contributions made by your employer are not taxable to you; contributions made by yourself, or others on your behalf, are an "above the line" deduction.

Transfers from FSAs, HRAs, IRAs
Individuals switching to coverage under an HSA-compatible health plan can have funds transferred from Flexible Spending Arrangements (FSAs) or Health Reimbursement Arrangements (HRAs) to an HSA. Visit with your employer or tax advisor for more details regarding distributions and penalties that could be assessed.

A one-time contribution can be made to an HSA from an Individual Retirement Arrangement (IRA) distribution. Visit with your tax advisor for details regarding contributions and penalties that could be assessed.

Effects on Traditional or Roth IRA Contributions
Contributions to your HSA will not affect contributions to a Roth or traditional IRA. HSA funds may not roll over into an IRA.

Catch-up Contributions for Individuals 55 or Older
If you are between the ages of 55 and 65, the HSA contribution limit is increased by $1000 during 2010 and all years going forward. Someone over age 65 but not enrolled in Medicare Part A or B may still make catch-up contributions.