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Health Savings Accounts
Health Savings Accounts
Save for future health care
expenses with a Health Savings Account!
Health care costs are rising. Higher deductibles, copays, and benefits premiums
are being passed on to employees as companies try to cut their costs and save
money. A Health Savings Account is used for paying or reimbursing qualified
medical expenses to the participant, dependent(s), or spouse. These accounts
provide a way for employees to manage health care costs through individual
flexibility, control, and tax savings.
Why would I want a Health Savings Account?
Health Savings Accounts carry a whole host of benefits:
- Qualified contributions are fully tax-deductible (employer
contributions may be excluded from your gross income)
- Qualified distributions are tax-free
- Money saved can be applied directly to unexpected or high medical bills
- Contributions may be made any time during the year, and balances roll over from
year to year
- Health Savings Accounts can continue even if you change jobs.
How does it work?
Health Savings Accounts are held as a tax-exempt trust account. Contributions to
the account may be made by the account holder, his or her employer, family
members, or other individuals. Health Savings Accounts are portable! This means
that the account can be maintained even if you change employers. Accounts may
also be transferred between financial institutions. If you currently have a
Health Savings Account, consider transferring it to the BIC Foundation!
Am I eligible?
To be eligible to have a Health Savings Account, the individual:
- Must be covered by a qualified high-deductible health plan as defined by IRS
- Cannot be enrolled in Medicare
- Cannot be claimed as a dependent on someone else's federal income tax return
Are there limits to my contribution?
Yes. The contribution limits set by the IRS for 2008 are:
Single Coverage Annual Limit: $2,900.00
Family Coverage Annual Limit: $5,800.00
The annual contribution deadline is April 15th of the following year.
Contributions may be carried over from year to year.
How do I open a Health Savings Account?
To open a Health Savings Account, you must be enrolled in a qualified
high-deductible health plan. This carries an advantage - you'll have lower
premiums to pay!
Are there costs for this type
of account?
The Foundation does not charge a fee for service.
How can I make withdrawals
from the account?
Distributions from the account will be directly deposited in your bank
account with your instruction by phone or email.
Who can I talk to if I have questions?
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