What are the benefits to having an Health Savings Account (HSA)?

• HSA earnings accumulate tax-free
• Eligible contributions are excluded from income and are tax-free
• Distributions for qualified medical expenses are also tax-free
• Qualified medical expenses can include coinsurance, copays and your healthcare plan deductibles, plus other expenses your plan doesn’t cover. Some common IRS-qualified medical expenses include dental care, orthodontics, contacts, eyeglasses, hearing aids and batteries, face masks and other personal protective equipment to prevent the spread of COVID-19, physical therapy, infertility treatment, midwife services, walking aids, and even common over-the counter medicines such as acne medicine, allergy and sinus medicine, pain relievers, baby rash ointment, sleep aids, laxatives and stomach remedies.
• Unspent money in an HSA rolls over at the end of the year, so it’s available for future health expenses and continues to grow by earning interest. The money never expires.
• You can use your HSA to save for retirement. After age 65, you have the option to use your HSA money for non-health related expenses without a penalty, and just pay income taxes on your withdrawals. Or continue to use the funds for qualified medical expenses, tax free.

*This information is provided to you with the understanding that Union Savings Bank is not engaged in rendering tax advice. If tax advice is required, you should seek the services of a tax professional.