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Health Savings Accounts

What is a Health Savings Account?

A Health Savings Account is a tax-exempt account held by an individual, established exclusively for the purpose of paying for the following:

  • Qualified medical expenses
  • Qualified preventive care
  • Qualified long-term care insurance
  • COBRA continuation
  • Health insurance in effect while receiving unemployment compensation under any federal or state law
  • Any health insurance other than a Medicare Supplemental policy if you are age 65 or older.

Individuals establish a Health Savings Account at Bank of New Hampshire by opening a HSA Checking account. 

Who Qualifies for a Health Savings Account?

Individuals currently enrolled in a qualified high deductible health plan (HDHP) can open a HSA Account. A qualified high deductible health plan (HDHP) for 2014 is defined as one in which the minimum deductible amount must be no less than $1,250 for an individual or $2,500 for a family.*

  • The maximum allowable annual contribution is $3,300 for an individual
  • The maximum allowable annual contribution is $6,550 for a family
  • If over the age of 55, the maximum allowable contribution is $4,300 for an individual
  • If over the age of 55, the maximum allowable contribution is $7,550 for a family

In addition to having a HDHP to qualify for a HSA, the individual must not be:

  • Covered under another health plan
  • Entitled to Medicare benefits
  • Claimed as a dependent on someone else’s tax return

*The minimum deductible amount for an individual or family is determined by the IRS and may change over time. 

Individual Benefits of Health Savings Account:

  • A Health Savings Account offers a flexible and long-term investment opportunity
  • HSAs rollover from year to year
  • Funds in the HSA belong to the individual and stay with the individual regardless of employment changes
  • Funds can be used for non-medical expenses if you are age 65 or older
  • Funds grow without being subject to taxes until they are used for non-eligible medical expenses.**
  • Funds are completely tax-free when used for eligible medical expenses.
  • Contributions can be deducted from your gross income for tax purposes**. 

**Consult your tax advisor regarding deductibility and possible IRS penalties for use of funds for non-eligible expenses. 

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