IF YOU ARE SELF EMPLOYED OR WORKING FOR AN EMPLOYER THAT HAS NO HEALTH INSURANCE BENEFITS AVAILABLE, YOU MIGHT WANT TO TAKE A CLOSER LOOK AT THE HEALTH SAVINGS ACCOUNT (HSA).

THE HEALTH SAVINGS ACCOUNT IS A FUND THAT YOU CREATE TO PAY FOR UNINSURED MEDICAL COSTS. UNINSURED MEDICAL COSTS ARE THOSE CHARGES YOU MUST BEAR RELATED TO THE DEDUCTIBLE AND ANY MAJOR MEDICAL CO-INSURANCE CHARGES. HOWEVER, MOST MAJOR MEDICAL PLANS DO NOT PAY FOR VISION AND DENTAL COVERAGES.THE VISION AND DENTAL CHARGES ARE ALSO CONSIDERED UNINSURED MEDICAL COSTS AND THE HSA FUND CAN BE USED TO PAY FOR THOSE CHARGES TOO.

WHEN YOU CREATE THE HSA FUND YOU CAN PUT UP TO $2,600 PER CALANDER YEAR IN AN INDIVIDUAL ACCOUNT AND UP TO $5,150 IN A FAMILY ACCOUNT. THOSE DEPOSITS ARE THEN TAX QUALIFIED IN THAT YOU WILL REDUCE YOUR GROSS INCOME BY THE AMOUNT OF THE DEPOSITS (LIKE THE DEDUCTION YOU CAN TAKE FOR AN IRA).

FURTHER, WHEN YOU WITHDRAW THE MONEY FROM THE HSA ACCOUNT, THE WITHDRAWALS USED FOR UNINSURED MEDICAL EXPENSES ARE TAX FREE WITHDRAWALS.

FINALLY, ANNUAL DEPOSITS NOT USED DURING THE CALANDER YEAR WILL CARRY FORWARD TO THE NEXT CALANDER YEAR WITH NO PENALTY.

THE MAJOR MEDICAL POLICY WRITTEN IN CONJUNCTION WITH THE ACTUAL HEALTH SAVINGS ACCOUNTS HAVE CERTAIN PARAMETERS:

(A) TO MAXIMIZE YOUR HSA CONTRIBUTION, SINGLE COVERAGE REQUIRES A MINIMUM CALANDER YEAR DEDUCTIBLE OF $2,600,

(B) TO MAXIMIZE YOUR HSA CONTRIBUTION, FAMILY COVERAGE (2 OR MORE) REQUIRES A MINIMUM CALANDER YEAR DEDUCTIBLE OF $5,150.

FOR THE SELF EMPLOYED, THE MAJOR MEDICAL HEALTH INSURANCE PREMIUM IS ALSO FULLY DEDUCTIBLE FOR INCOME TAX PURPOSES.

FOR MORE INFORMATION PLEASE CONTACT W.E. HEASLEY, CLU, LUTCF AT 336 282 8611, 800-868-5242, OR info@heasleyagency.com.