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October 29, 2011
Why Health Savings Accounts Have A Loyal Following
One reason is that HSA earnings are not taxed as long as the money remains in the account. Withdrawals to pay for most health care expenses will not be taxed, either. Health care expenses for family members can be covered with an HSA even though those family members are not covered under the HSA-qualified high-deductible health plan.
The other tax advantage is that HSA contributions double as tax deductions regardless of whether the money is spent on health care. Up to the government-set maximum, HSA contributions are considered to be “above the line” deductions. That means you can take the deduction without itemizing deductions.
A third reason for the growing popularity of Health Savings Accounts is that they offer greater flexibility than traditional forms of retirement savings. HSA funds may be invested in bonds, mutual funds or stocks. They can also be placed in savings accounts to earn tax-free interest. At age 65, HSA funds may be used for any purpose with no penalty fee, but taxes will be due for withdrawals not spent on qualified health care.
Unlike IRAs, HSA funds can remain invested throughout retirement. If needed for health care, though, HSA money can be withdrawn at any time with a penalty. HSA funds are not "locked up" until owners turn 65, and HSA owners are not forced to liquidate investments.
HSA Plans also tend to offer lower insurance premiums, which just adds to the savings. Even for those in high tax brackets, basically the middle class, HSA-qualified plans that have slightly higher premiums may be offset by all the additional savings. To see whether an HSA Plan would fit your situation, you can learn more about HSA Plans with our extensive online resources.
Posted by Wiley Long at 01:30 AM | Comments (0)
October 27, 2011
The New Health Savings Account Strategy
Consumers continue to make the most of Health Savings Account (HSA) Plans. One new trend is to increase the deductible on the HSA-qualified health plan as the HSA balance grows. This often results in lowering the monthly premium, which in turn increases the potential to save money. In case the Health Savings Account owner does need to meet the HSA plan’s deductible, the Health Savings Account balance can cover the gap until the insurance company starts to pay for medical claims.
Switching health insurance plans in order to lower premium costs as the HSA balance grows works better when the high-deductible health plan and the HSA are coming from different companies.
If the insurance company doubles as the HSA administrator, changing the health plan may mean changing the HSA, too.
The ability to grow a Health Savings Account balance is simply not possible with flexible savings accounts. Those funds revert back to employers if not used by employees at the end of the year. That’s one of the reasons that the HSA option has become so popular. HSA money rolls over every year to keep on growing with tax-free earnings, and it always remains the property of the employee even when an employer make contributions.
How you invest HSA funds is up to you even when your employer contributes to your HSA. As the demand for HSA options has grown, more financial institutions have jumped on board to add greater choice and convenience. You can now invest HSA funds in bonds, mutual funds, savings accounts that pay interest or stocks. Withdrawals can sometimes be made by check or with cards, like debit cards. More information about HSA benefits and perks can be found on our website.
Posted by Wiley Long at 01:02 AM | Comments (0)
October 24, 2011
Health Savings Accounts Mean Lower Taxes
In tough times, people need to be innovative to reduce what they spend on health care without giving up access to medical services. One way that people can gain more control over what they pay for health care and for taxes is called the Health Savings Account (HSA) Plan.
HSA Plans give tax deductions for money deposited in an HSA. That money accrues interest as long as it remains in the account, which can be until you want to use it for retirement. All the while it is growing with tax-free earnings, you can deduct annual contributions to lower your taxes.
Contributions made to your Health Savings Account before the April tax deadline becomes an "above the line" deduction for the previous year's tax return. Since that money is not counted as income, it’s not subject to income tax or FICA tax.
To make an HSA work, you need a high-deductible health plan that allows you to start an HSA. Not all do, so look for HSA-qualified plans. Once you have the insurance in place, you can open an HSA and you're under no requirement to fund it beyond the opening deposit. That means you can either fund it to the max, lower your taxes and deposit what you save on premiums and taxes. Or, you can wait until you have medical expenses to cover, deposit just enough to cover that and make an immediate withdrawal. You can even reimburse yourself at a later date.
You can learn how much you can deduct from your taxable income for individual and family plans, as well as see what types of HSA Plans are available here with us. Small business owners can also use these plans to cover employees for reduced premiums.
Posted by Wiley Long at 08:44 AM | Comments (0)
October 18, 2011
Health Savings Account Plans Offer Triple Benefits Over Old-fashioned Health Insurance
Health Savings Account (HSA) Plans are not just health insurance. They are low-cost, high-deductible insurance plans, potential tax deductions, and savings accounts with investment opportunities similar to IRAs and Roth accounts. That's how they offer three times more than old-fashioned policies.
Since they came to market in 2004, HSA Plans have attracted a loyal following. That's because their insurance premiums tend to be on the low-end and HSA Plans offer significant tax advantages.
There are no HSA contribution requirements other than upper limits. Funds deposited in an HSA can be taken as tax deductions even without itemizing deductions. They're considered "above the line deductions" for federal and almost all state tax filings. Our site shows how individual states treat HSA contributions.
Contributions to your Health Savings Account can on kept liquid to facilitate withdrawals as with an interest-bearing savings account, or invested in bonds, mutual funds or stocks. That makes them competitive with IRAs and Roth accounts.
HSA earnings are not taxed while in the account. Neither are withdrawals used pay for qualified health care expenses taxes. At age 65, HSA owners may spend the funds for any purpose, but HSA funds spent on anything other than eligible health care are then subject to taxation. More information about how these HSA plans work is available on our website: http://www.health--savings--accounts.com
Posted by Wiley Long at 10:03 AM | Comments (0)
October 12, 2011
Health Savings Accounts Reformed Health Insurance
Since Health Savings Account (HSA) Plans became available in 2004, people have been using them to reshape what health insurance had to offer. From low-cost coverage to tax advantages, HSA Plans reformed health insurance.
Health savings accounts allow people to put money aside for future medical expenses and grow that balance with tax-free earnings. When HSA funds were needed to pay for qualified health care expenses, the withdrawals were also free from taxation.
Even greater savings were possible with the chance to reduce taxable income. Within government limits, Health Savings Account contributions can be taken as deductions to lower federal, and usually state, tax bills.
One of the most important benefits of HSA Plans is that contributions may be invested just like IRA contributions. The choices range from simple interest-bearing, liquid savings accounts to bonds, mutual funds or stocks. But, unlike IRA money, HSA balances aren't locked up until HSA owners turn 65.
Another important difference is that HSA owners aren't required to make mandatory withdrawals during retirement. To learn more about the greater control that HSA Plans offer before and after retirement, please see our online resources.
Posted by Wiley Long at 11:03 AM | Comments (0)
October 07, 2011
How Health Savings Accounts Cut Taxes
Tax day 2012 is still a ways off, but those who want to pay less taxes are maxing out their Health Savings Account contributions now. What a lot of people don’t realize is that their health insurance plan can be turned into a fabulous way to save on taxes by adding a Health Savings Account or an HSA.
When you have an HSA Plan, you can make tax-deductible contributions to pay for many out-of-pocket health care costs. You have until April 15, 2012 to make the maximum HSA contribution for 2011. The maximum contribution for singles is $3,050 or $6,150 for families.
Tax-free HSA withdrawals are allowed when you use the money for qualified medical expenses. If you use HSA funds for other purpose, there is a 20-percent penalty on the withdrawal up until you turn 65. Just like with an IRA, any unspent HSA money rolls over year after year to build your savings.
An HSA can also serve as an investment vehicle. HSA money can grow tax-free when invested in bonds, money market funds, mutual funds or stocks. You can also earn tax-free interest in a traditional savings account. Learn more about the advantages Health Savings Accounts offer here on our site:
http://www.health--savings--accounts.com
Posted by Wiley Long at 04:37 AM | Comments (0)
October 04, 2011
Health Savings Accounts Lower Out-Of-Pocket Costs
Like all high-deductible plans, those that are qualified to be combined with a Health Savings Account (HSA) now cover preventive health care. That's only true for plans purchased after health care reform, though.
HSA Plans are high-deductible policies combined with an HSA. Like other high-deductible plans, HSA Plans are often less expensive than co-pay plans. They could be a more affordable route for employees struggling to pay for rising rates on group coverage.
As of 2011, the maximum HSA contribution for individuals is $3,050 or $6,150 for families. Those who are at least 55 can make an additional annual contribution of $1,000. Contributions can be deducted from taxable income to reduce federal and usually state taxes. Only a handful states remain where HSA deposits can not be used as state tax deductions.
Any HSA contributions that are not needed for health care can grow with tax-free earnings. It may be wise to start with a relatively low deductible, and move to a higher deductible as your HSA balance grows. That way you won't get caught with a lot of out-of-pocket costs. To research what HSA Plans are available, just run instant quotes on our site.
Posted by Wiley Long at 02:18 AM | Comments (0)
October 01, 2011
Health Savings Accounts Protect In Numerous Ways
Health Savings Accounts have the potential to not only allow investors to cover health-care costs with tax-free dollars, but to also help them build a retirement nest egg.
If you are under 65, you can open a Health Savings Account (HSA) as long as you have a high-deductible health insurance plan that's qualified to be combined with one of these special health savings accounts. You can even keep an HSA while you have another insurance policy, but you cannot have medical expenses paid by both an HSA and other insurance.
One of benefits of HSA Plans is that they offer a range of investment options similar to IRAs. You can invest in bonds, mutual funds or stocks and any earnings will be tax free. Of course, an interest-bearing savings account is also an option.
HSA Plans have high deductibles and so they may offer premiums that run about 30 to 40 percent lower than conventional co-pay plans, depending on your age. HSA-qualified Plans must also have a limit on your out-of-pocket expenses. Visit our site to see more details about how Health Savings Account Plans work, including how to select an HSA administrator.
Posted by Wiley Long at 02:36 AM | Comments (0)