HSA Guide

🏥 Health Savings Accounts (HSAs): How They Work and Why You Should Consider One

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Few tools cut healthcare costs like a Health Savings Account (HSA).
If you’re on a High Deductible Health Plan (HDHP), an HSA can deliver a rare TRIPLE TAX ADVANTAGE, help you prepare for unexpected bills, and even boost retirement readiness.

👉 Talk to an Agent
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❓ What is an HSA?

A Health Savings Account is a tax-advantaged account for qualified medical expenses.

✅ Money goes in tax-free
✅ Grows tax-free (including investments, where available)
✅ Comes out tax-free when used for qualified expenses

Common Qualified Expenses:

Doctor visits, urgent care, hospital bills
Prescription drugs and many OTC items
Dental cleanings, fillings, orthodontics
Vision exams, glasses, contacts

💡 Did you know? HSAs are portable (yours, not your employer’s) and balances roll over year after year—no “use it or lose it.”

🌟 Key Benefits of an HSA

💵 Tax Savings Now – Every dollar you contribute lowers taxable income.
🔄 Year-to-Year Rollover – No end-of-year forfeits.
📈 Investment Potential – Many providers let you invest once a cash threshold is met.
🧓 Retirement Flexibility – After 65, use funds for any expense without penalty.
🛡 Emergency Safety Net – Build a cushion for health expenses.

⚠️ Heads-up: If you’re under 65 and use HSA funds for non-qualified expenses, you’ll owe income tax plus a 20% penalty.

👥 Who Can Open an HSA?

You must:

Be enrolled in a High Deductible Health Plan (HDHP)
Not be enrolled in Medicare
Not be claimed as a dependent on someone else’s tax return

📖 Learn About Medicare & HSAs

2025 Contribution Limits:

$4,300 — Individual
$8,550 — Family
+$1,000 — Catch-Up (age 55+)

👉 Not sure if your plan is HSA-eligible? Contact us.

🛠 Step-by-Step: Setting Up Your HSA

1️⃣ Confirm eligibility (must meet HDHP criteria)
2️⃣ Choose an HSA provider — compare fees, debit card access, and investments
🔗 Our Recommended Options
3️⃣ Open the account (ID, SSN, plan details)
4️⃣ Decide contributions (up to IRS limits)
5️⃣ Fund it (payroll deduction or direct contribution)
6️⃣ Spend & track (use HSA card, keep receipts)
7️⃣ Consider investing after you build a cash buffer

💡 Quick Tip: Start small with automatic contributions, then increase after a raise or bonus.

⏳ Why Consider an HSA Now?

Lower your taxable income this year
Build a dedicated emergency fund
Create a long-term healthcare nest egg

👉 Talk to an Indy Health Agent
👉 Compare HSA Providers

🧓 Medicare & HSAs (Good to Know)

Once you enroll in Medicare, you can’t contribute to an HSA—but you can still use your balance tax-free.

📖 Learn more:

❓ HSA FAQs

Q: Can I use HSA funds for my spouse or dependents?
A: Yes—qualified expenses for your spouse and tax dependents are eligible.

Q: What if I switch jobs?
A: Your HSA is yours. You keep the account and balance.

Q: What happens if I spend HSA money on non-qualified expenses?
A: Under 65 → Income tax + 20% penalty.
65+ → Only regular income tax (no penalty).

Q: Can I have both an HSA and FSA?
A: Not at the same time—unless it’s a limited-purpose FSA (dental/vision).