Some policymakers are seeking to expand the scope of health savings accounts (HSAs), which are medical savings accounts that are used to pay for out-of-pocket medical expenses.
Proposed expansions include a one-time matching $1,000 tax credit, raising the annual contribution limit (currently at $3,350 for individuals and $6,750 for families), allowing HSAs to be used with any type of health plan, allowing HSAs to pay for health insurance premiums, and allowing HSAs to be exempt from bankruptcy proceedings.
Currently, HSAs are only available to people who are enrolled in high deductible health plans. Individuals can choose to invest the money in their HSAs and grow them tax-free. Money placed into an HSA cannot be taken out for nonqualified medical expenses without having to pay penalties.
The owner of the HSA can withdraw any money from an HSA without penalty after he or she turns 65. However, any money withdrawn after this point would be taxed as income. Learn More
Select which expansions you would like to include for health savings accounts (HSAs). You may choose all, some, or none.
Include a one-time matching $1,000 tax credit
Raise the annual contribution limit
Allow HSAs to be used with any type of health plan
Allow HSAs to pay for health insurance premiums
Allow HSAs to be exempt from bankruptcy proceedings