What is an HSA?
According to Health Equity, an HSA (Health Savings Account) paired with an HSA-qualified health plan allows you to make tax-free contributions to an FDIC-insured savings account.
What does that mean? It means that you have the opportunity to have an account where you can use the money within that account, for a majority of your medical expenses. To top it off, Dr. Davis & Dr. Pyle give you a contribution to get it started! Thats right, you read that right. Dr. Davis & Dr. Pyle as owners, give each of us $2,000 to put in our HSA to help us start saving and growing interest on our HSA.
For some of you, this may sound familiar while for others you are just learning everything about an HSA. Below is the link to Health Equity, where you can use this as a reference with any questions or concerns. The website contains videos, lists and articles that will help you understand it more & more.
To get you started with your HSA, there are 2 things you will run into first. Which are:
How do I sign up?
I went to the doctor, but now what?
Below are 2 videos that our team as put together for you. Take time and review them and use them as a reference while learning your HSA.
Each year the HSA (Health Savings Account) limit can increase. For 2019, the new limits are $3500 for people with individual plans and $7000 for people on family plans.
This is great news! If you would like to maximize your tax savings, you can contribute up to those amounts directly from your paycheck.
There is a maximum per pay period that you can contribute and you can calculate that amount here.
There is more information here, but these are the basics:
You can contribute money into your HSA without paying income taxes on it. That makes those dollars 20-30% more valuable!
You don’t pay taxes on any interest earned.
You don’t pay taxes when you spend the money on qualified medical expenses, check here to see what qualifies.
You don’t lose the money each year if you don’t use it, it rolls right over to the next year!
To get the most out of the tax benefits at the end of each year, you can contribute to your HSA for the prior year as long as you complete the process before the tax filing deadline. This does not apply to any payment made via payroll but you can still transfer directly from your bank account for 2018! Here’s how:
Log into your bluecrossnc.com
Click “Health Care Summary Report” in the left-hand menu to find the total out-of-pocket expenses you’ve had for medical claims in 2018.
Subtract the amount you’ve personally contributed this year (not including what Dr. Davis and Dr. Pyle have contributed) from your total out-of-pocket expenses.
Whatever the result is, log into your Health Equity HSA account and contribute that amount towards your 2018 limit before filing your 2018 taxes (up to $3,450 for singles and $6,900 for families)
Withdraw the money you just contributed as soon as it’s posted to your HSA account.