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Have questions about Health Savings Accounts? Ask Austin Bank.

Have a question about Health Savings Accounts? Ask Austin Bank.

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What is a Health Savings Account?

A Health Savings Account is a tax-exempt account established exclusively for the purpose of paying qualified medical expenses of you and your family.

Who is eligible for a Health Savings Account?
To be eligible for a Health Savings Account, an individual must be covered by a High Deductible Health Plan (HDHP), must not be covered by other health insurance (does not apply to specific injury insurance and accident, disability, dental care, vision care, long-term care), is not eligible for Medicare, and can not be claimed as a dependent on someone else’s tax return.

What is a “High Deductible Health Plan” (HDHP)?
For 2007 and after, a HDHP is a health insurance plan with minimum deductible of $1,100.00 (self-only coverage) or $2,200.00 (family coverage). The annual out-of-pocket (including deductibles and co-pays) cannot exceed $5,250.00 (self-only coverage) or $10,500.00 (family coverage). HDHPs can have first dollar coverage (no deductible) for preventive care and higher out-of-pocket (copays & coinsurance) for non-network services.  These amounts are subject to cost-of-living adjustments (COLAs).

Who can contribute to a Health Savings Account?
Contributions to HSAs can be made by either the employer, or the individual, or both. If contributions are made by the individual, it is an “above-the-line” deduction. If contributions are made by the employer, it is not taxable to the employee (excluded from income).

How much can I contribute to a Health Savings Account?

The maximum contribution is the lesser of the deductible amount under the HDHP or $2,850.00 for individuals or $5,650.00 for family coverage for 2007 and after.. These dollar limits will be adjusted for inflation each year.

The catch-up contribution is for 2007 is $800; 2008 is $900; 2009 and after is $1,000.

Do Health Savings Account funds roll over year after year and get invested?
Yes, the money invested in a Health Savings Account rolls over year after year.

Who has control over the money invested in a Health Savings Account?
In most cases the individual will have control over the assets.

What is the minimum to open a HSA at Austin Bank?
$100.00

Is there an account setup fee? If so, what is it?
Austin Bank will charge a one-time fee of $15.00 for account setup.

Is there a monthly maintenance fee?
If the minimum balance falls below $100.00, a $5.00 maintenance fee will be charged.

How do I access the money in my HSA?
Your HSA may be accessed either by check or ATM Debit Card.

Will I receive interest on my HSA?
Yes, interest accrues daily on the actual collected balance of $1,500.00 and above and is paid quarterly at rates set periodically.

Will I receive my checks back in my statement?
You will not receive the actual checks, but images of the checks which are acceptable for tax reporting purposes.

What are the tax benefits of a HSA?
Please contact your tax or legal professional for guidance in answering this question.

When is the Contribution Deadline for Funding a HSA?
Regular and catch-up HSA contributions can be made at any time for a taxable year up to and including your federal income tax return due date, excluding extensions for that taxable year. The due date for most taxpayers is April 15.

Can an employer who is currently uploading a direct deposit file to us over the internet include the HSA deposits in the file?
Yes. These deposits will be posted as employer contributions for the current year.

How can an employer make the contribution deposits if he does not currently send us a direct deposit file, but has multiple employees?
We can set them up on our ACH Editor program so they can create a contribution file to send us. There is a one-time set up fee of $250 and then a fee of $25 per file plus $.10 per employee each time they send the file.
 
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