Healthcare Savings Accounts (HSA)

Employees participating in a qualified HDHP can open an HSA account. Contributions to an HSA are not subject to federal or state income tax, they rollover year-to-year, and can have interest bearing accounts. HSA funds can be withdrawn tax-free to pay for eligible medical expenses and can be funded by the employee, by the employer, or both the employee and employer.

Benefits for Employers

• Employers reduce FICA taxes
• Employer contributions to employee HSAs are tax-deductible

Benefits for Employees

Employees not only have access to funds to pay for current and future healthcare expenses, but also qualify for 3 tax advantages:

• Contributions are pre-tax
• Withdrawals for qualified medical expenses are tax-free
• Interest earned on investment fund options are tax-free