Health Savings Account

The Health Savings Account (HSA) is a tax-free interest bearing account that can be used to pay for medical expenses. To qualify, the individual must have a high-deductible health insurance plan. For 2019, the annual deductible on an individual plan must be at least $1,350 and at least $2,700 for a family plan. The annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not premiums) cannot exceed $6,750 for self-only coverage or $13,500 for family coverage. For 2020, the annual deductible on an individual must be $1,400, and at least $2,800 for family and not exceed $6,900 for individuals and $13,800 for families. The annual out-of-pocket expenses for 2020 (deductibles, co-payments, and other amounts, but not premiums) cannot exceed $6,900 for self-only coverage or $13,800 for family coverage.

Benefits:

  • Annual contributions into an interest-bearing checking account are tax-deductible. Contributions can be made all at once or throughout the year
  • Interest is earned tax-free

Features:

  • For 2020, the annual contribution limit for an individual is $3,550 and $7,100 for a family contribution
  • Contributions can be made annually. You have up until April 15th or your tax-filing deadline to contribute for the prior year (Contributions for 2019 can be made up until July 15, 2020)
  • If you’re 55 or older anytime in 2020, you are able to contribute an extra $1,000
  • Write checks to withdraw money for medical expenses throughout the year. Amounts distributed are not taxable provided they are used for medical expenses
  • Or, you can pay your medical expenses out-of-pocket and let the HSA balance accumulate tax-free. There are no withdrawal requirements
  • You select primary and secondary beneficiaries who will receive the HSA in the event of your death
  • A minimum deposit of $100 is required to open the account. If the balance falls below $100, there is a $3 fee for that month

FDIC Insurance Information

For information about FDIC insurance coverage of transaction accounts, please visit the FDIC website.