Why Pay Extra for Already Expensive Healthcare? Consider a Heath Savings Account.

Save money for everyday medical costs and when emergencies occur with your Health Savings Account (HSA).

It’s a federally approved, tax-exempt account that can help you subsidize the cost of healthcare, from prescriptions to hospital visits.

If you have a High Deductible Health Plan (HDHP), you could be eligible for an HSA. It’s easy to set up, track, and manage your annual healthcare expenses with the efficiency of online banking.

 

Qualifications

To qualify for an HSA, the following requirements must be met:

• You must be covered by a High Deductible Health Plan (HDHP) that offers eligibility on the first of the month. Please check with your insurer.
• You cannot have health coverage that is not an HDHP.
• You must be under age 65 and not enrolled in Medicare.
• You cannot be claimed as a dependent on someone else’s tax returns.

 

Contributions for 2022

Self-Coverage: $3,650.00

Family Coverage: $7,300.00

Age 55 and Up: $1,000.00

 

Contributions for 2023

Self-Coverage: $3,850.00

Family Coverage: $7,750.00

Age 55 and Up: $1,000.00

 

Distributions

Distributions can be made for various health-related costs, ranging from co-pays to the purchase of medical equipment. There is no required minimum distribution amount, so funds may be carried forward from year to year. Individuals can receive tax-free distributions to complete transactions or be reimbursed for qualified medical expenses.

If distributions are used toward non-approved transactions, the amount withdrawn will be subject to income tax and may be subject to an additional 20% tax (per the IRS), unless the funds are withdrawn due to death, disability, or turning 65. At age 65 (or older), funds can be withdrawn for non-qualified medical expenses and will be taxable without IRS penalty.

Important note about overdrafts: Overdrawing an HSA is prohibited by the Internal Revenue Code. If you create a negative balance in your HSA, it is no longer treated as an HSA. To prevent this, Manasquan Bank will deny any payments that overdraw your HSA.

For more information, visit IRS.gov and download "Publication 969 – Health Savings Accounts and Other Tax-Favored Health Plans."