Single Plan

Family Plan

Minimum Deductible

$1,200

$2,400

Maximum Out-of-Pocket

$5,950

$11,900

Contribution Limit

$3,050

$6,150

Catch-Up Contribution (55 or older)*

$1,000

$1,000

* If a spouse is also 55 or older, a second HSA must be established and a second contribution of $1,000 could be made to that account.

When you have a qualifying High Deductible Health Plan (HDHP), the following contribution guidelines apply.

• Anyone can contribute to your HSA.
• Your contributions are tax deductible.
• If your employer contributes to your HSA, that contribution is done on a pre-tax basis.
• Any pay-roll deductions made through Section 125 for your HSA are also on a pre-tax basis.
• You may contribute the annual maximum amount as determined by the IRS, regardless of your plan’s deductible. The maximum for 2008 is $2,900 for individuals and $5,800 for families.
• You may contribute the annual maximum amount determined by the IRS, regardless of when your coverage begins, if you maintain coverage for the 12 month period beyond the calendar year in which you first became eligible. The maximum for 2009 is $3,000 for individuals and $5,950 for families.
  • Example: if you have individual coverage that begins in November 2008, you may still contribute $2,900 for 2008 when you maintain coverage through the end of 2009.
• Your employer may roll over funds from your HRA or FSA account once, according to the legislative provisions.
• If your employer allows the FSA extension where 2006 FSA funds can be used until March 15, 2007, you may still contribute to an HSA, if your FSA balance is zero or the FSA balance is transferred to an HSA by January 1st, 2007.

Distributions

Here are some key points about distributions:

• You can use your money tax-free at any time for eligible medical expenses.
• When you turn 65, you can use the money for non-eligible medical expenses. The money is subject to income tax, and there are no IRS penalties.
• If you are under age 65 and use your money for non-eligible medical expenses, you will be subject to income tax and a 10% tax penalty.

Tax Advantages of a Health Savings Account

Federally Qualified HSAs are tax-deductible, tax-deferred, and tax-free.

• Tax-deductible: Contributions to your HSA can be deducted from your gross income.
• Pre-tax: Contributions made to your HSA through payroll deductions.
• Tax-deferred: Your HSA money grows without being taxed.
• Tax-free: You can use your HSA money tax free for eligible medical expenses.

Over the life of your HSA, you can save thousands of dollars in taxes. These tax advantages occur at the federal level. To see if your state provides tax benefits for HSAs, please contact your state resource.