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May 25, 2011
Are Health Savings Accounts Linked To Employment?
Unlike a flexible spending account, Health Savings Accounts are independent of employment. Meaning that a Health Savings Account (HSA) is yours to keep whether you become unemployed or not. Even if your employer does not offer an HSA plan, you can start one on your own. Simply purchase an HSA-qualified high-deductible health plan and you’re ready to open your own HSA.
Getting an HSA plan is beneficial because the money you place in your health savings account earns interest tax-free. You get to use the money in your HSA for future qualified medical expenses.
Withdrawals from your Health Savings Account for qualified medical costs are also free of tax and you don’t even have to itemize deductions to claim your HSA contribution. Your HSA funds even roll over at the end of the year to continue growing tax-free the next year.
Although you own your HSA, your employer can make contributions to your health savings account. The contributions are tax-deductible on the employer’s part and are not included in your gross income. If you decide to leave that job or lose it, the contributions made by the employer stay with you. Even after you retire, you get to keep and use the money in your HSA.
Want to see more? On our website, it's quick and easy to compare rates for HSA-qualified insurance plans. You can learn about starting your HSA and selecting an HSA administrator here, too.
Posted by Wiley Long at May 25, 2011 04:17 AM