• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer
  • Home
  • Who We Are
    • About Our Firm
    • Career Opportunities
    • Meet Our Team
    • News and Events
    • Seniors Rock Radio
  • Estate Planning
    • Elder Law & Medicaid Planning
    • Estate Planning Services
    • Estate and Gift Tax Figures
    • Family Farm Succession Planning
    • Family-Owned Businesses & Farms
    • IRA Planning
      • Planning With An IRA
      • IRA & Retirement Planning
    • Legacy Planning Services
    • LGBTQ Estate Planning
    • Pet Planning
    • SECURE Act
    • Special Needs Planning
    • Trust Administration & Probate
    • Young Families
  • Elder Law
    • Coping With Alzheimer’s
    • Elder Law Resources
      • Elder Law Reports
    • Guardianship & Conservatorship
    • Hospice Care
    • Veteran’s Benefits
  • Resources
    • Definitions
    • FREE Estate Planning Worksheet
    • FREE Webinars
    • Estate Administration Legal Guide
    • Estate Planning Articles
      • Questions for Your Estate Planning Attorney Before Creating Your First Estate Plan
      • How to Create Your First Estate Plan in 2022
      • How to Choose a Guardian for Your Child
      • Address These Three Questions in Your First Estate Plan
    • Estate and Gift Tax Figures
    • Frequently Asked Questions
      • Adult Guardianship
      • Alzheimer’s Care
      • Custodial Accounts for Minors
      • Estate Planning
      • FAQs for Families Without an Estate Plan
      • Elder Law
      • IRA & Retirement Planning
      • Is Your Estate Plan Outdated?
      • Legacy Planning
      • LGBTQ Estate Planning
      • Medicare and Social Security
      • Probate
      • Probate Avoidance
      • Irrevocable Trusts
      • Trust Administration
      • Trusts
      • Veterans’ Benefits
      • Wills
    • Newsletters
    • Reports
      • Advanced Estate Planning
      • Basic Estate Planning
      • Estate Planning for Niches
      • Trust Administration
    • Top Estate Planning Techniques
  • Reviews
    • Our Reviews
    • Review Us
  • Medicaid Planning
    • Medicaid Planning
    • Emergency Medicaid & Nursing Home Planning
    • Medicaid Frequently Asked Questions
    • Medicaid Resources
  • Blog
  • Contact Us

Law Office of Michael Robinson, P.C.

Estate Planning Services in Rochester, New York and the Finger Lakes Area

Connect With Us Today

(585) 374-5210
Law Pay Button
Attend a Free Webinar
Home » Insurance » How A Health Savings Account Works

How A Health Savings Account Works

August 16, 2010Insurance

A Health Savings Account (HSA) is a great way to plan for high medical costs. If you have a high deductible health coverage plan and are considering opening an HSA to supplement the deductible cost, here is what you need to know.

How to Get Started

Before you open an account with a bank or insurance agency, check to see if your employer provides an HSA. This may be the case if their offered health coverage is high deductible. When you open your account make sure it pays interest. You may have to meet a minimum balance before interest begins. Interest earnings are a great way to make money off your HSA while you are healthy and don’t need the funds. You may also have the option to invest your account like a 401K or an IRA. This allows you to earn more toward health care expenses when you are older.

How to Contribute

You can contribute post-tax money into your account and take a tax deduction at the end of the year. If your HSA is through your employer they can contribute pre-tax income from your paycheck. You can pay into your account each month or once a year. Your minimum contribution is based upon your insurance agent or bank’s requirements. It is best, however, to make sure you have enough in your account to pay your yearly deductible. You cannot exceed the IRS mandated yearly contribution limit. The limit for 2010 is 3,050 for an individual or 6,150 for families.

How to Pay Medical Expenses

So how do you use your account to pay medical bills? Your account holder may provide you with a debit card or checks to pay medical bills. If not, you will need to pay with your own money and then withdraw money from your account to recoup your loss.

Money withdrawn must be used only for qualified medical expenses, which are determined by the IRS. The IRS does not allow you to use your account to pay a health care premium unless it is for long term care insurance, basic Medicare costs, insurance while unemployed, or continuing a COBRA insurance plan after retirement. Do not use your account for any other purpose, or you will have to pay taxes on the amount withdrawn. If you are under 65 and not disabled, you will also have to pay a ten percent penalty.

  • Author
  • Recent Posts
Michael Robinson, Estate Planning Attorney
Michael Robinson, Estate Planning Attorney
Clients notice Michael Robinson’s unique approach to his estate planning practice the minute they walk through his office doors.
Michael Robinson, Estate Planning Attorney
Latest posts by Michael Robinson, Estate Planning Attorney (see all)
  • How Estate Planning for a Family May Trap the Unwary Practitioner - August 31, 2022
  • State Income Taxation of Social Security Benefits - August 24, 2022
  • Understanding Tax Apportionment Clauses - August 17, 2022

Other Articles You May Find Useful

Law Office of Michael Robinson, P.C.
Critical Injury Insurance Questions
Law Office of Michael Robinson, P.C.
Life Insurance and Estate Planning
Law Office of Michael Robinson, P.C.
You Need Umbrella Liability Insurance
Law Office of Michael Robinson, P.C.
You May Not Be Able to Afford Long Term Care without Insurance
Law Office of Michael Robinson, P.C.
Estate Planning and Life Insurance: Three Drawbacks to Whole Life Policies
Law Office of Michael Robinson, P.C.
Naming Children as Life Insurance Beneficiaries

Primary Sidebar

Law Office of Michael Robinson, P.C.

Blog Subscription

  • This field is for validation purposes and should be left unchanged.

Follow Us

  • Facebook
  • Twitter
  • Linkdin
  • Youtube

TESTIMONIALS

News & Events

Seniors Rock Radio Show Recording 5-1-21

https://drive.google.com/file/d/1U7UkQbEGy-xY7XFAXvX9Qz7pKSVDVV3D/view?usp=drive_web   Author Recent Posts Michael Robinson, Estate Planning AttorneyClients notice Michael Robinson’s unique approach to his estate planning practice the minute they walk through his office doors. Latest posts by Michael Robinson, Estate Planning Attorney (see all) How Estate Planning for a Family May Trap the Unwary Practitioner -... Read more →

Pittsford Office

1163 Pittsford-Victor Road, Suite 120 (Powder Mill Office Park)
Pittsford, NY 14534-3817
Phone: (585) 374-5210
Fax: (585) 485-0394

See Larger Map Get Directions

Map

mrobinson_sidbr_map

Footer

  • Advantages of Working With Our Firm
  • About The American Academy
  • Disclaimer
  • Privacy Policy
  • Sitemap
  • Contact Us

Connect with Us

  • Facebook
  • Twitter
  • Linkdin
  • Youtube
robinson law logo

The Law Office of Michael Robinson, P.C.

Attorney Advertisement


© 2023 American Academy of Estate Planning Attorneys, Inc.