What is an HSA?
- A Health Savings Account (HSA) is a versatile checking account that works in conjunction with a High-Deductible Health Plan (HDHP).
- HSAs are tax-free personal investment accounts you can use to pay for qualified medical expenses. You open it and you own it.
- It is fully portable. Whether you change jobs or become self-employed, your account stays with you.
- You can make unlimited deposits or contributions up to the defined limit. You can deposit one large sum or make smaller monthly deposits that fit within your budget.
- Savings roll over year after year, so your unused funds are available to pay health expenses even during retirement.
- Freedom! Use HSA funds for qualified out-of-pocket expenses at the health provider of your choice.
- Your HSA with Illinois Bank & Trust earns interest and comes with a VISA® Debit Card for your convenience in paying for doctor fees, prescriptions and other medical expense purchases.
To participate in an HSA, you must first be enrolled in an HDHP. Then you can open an HSA and enjoy all the benefits while we handle the details!
What is an HDHP?This is your health insurance plan. HDHPs usually have lower premiums and higher annual deductibles than traditional health insurance. There is also a limit placed on total out-of-pocket expenses for an individual or family each year. Individuals must be enrolled in an eligible HDHP before they can open an HSA.
Tax savings—An HSA provides you triple tax savings:
- Contributions to your account are tax-deductible or tax-deferred if made by your employer.
- Your investment earnings are tax-free.
- Withdrawals for qualified medical expenses are also tax-free.
Investment options—You can use your HSA as part of your investment strategy by letting the money in your account accumulate from year to year. You can even earn more on balances of $5,000 and greater by investing in an HSA Certificate of Deposit.
Convenience—You have instant tax-free access to funds needed to cover qualified medical expenses when you use your HSA VISA® Debit Card.
2017 HSA Contribution Limits
|Under age 55||$3,400||$6,750|
Who is eligible for an HSA?
An eligible individual is anyone who:
- Participates in an HDHP.
- Does not have coverage through an additional health plan that is not an HDHP.
- Is not enrolled for Medicare or receiving VA Benefits.
- May not be claimed as a dependent on another person's tax return.
HSA Checking AccountEarn more interest on higher balances with an HSA Checking Account. A minimum of $25.00 is required to open the account. Additional benefits include free Online Banking, Bill Pay and eStatements.
Still have questions? Contact an Illinois Bank & Trust Personal Banker at any of our locations, or visit the U.S. Department of the Treasury to learn more about contribution limits and your responsibilities in managing and reporting your healthcare expenses.