With an HSA from Severn Bank, you’ll receive tax breaks because we allow you to make 100% tax deductible contributions up to the legal limit, to your accounts, withdraw money from your HSA without tax penalties if used for qualified medical expenses and decide how much money to save at a time to protect you against current and future medical expenses.

HSA Advantages

Tax-deductible:

Contributions to the HSA are 100% deductible (up to the legal limit).

Tax-free:

Withdrawals to pay qualified medical expenses, including dental and vision, are never taxed.

Tax-deferred:

Interest earnings accumulate tax-deferred, and if used to pay qualified medical expenses, are tax-free.

HSA money is yours to keep:

Unlike a flexible spending account (FSA), unused money in your HSA isn’t forfeited at the end of the year; it continues to grow tax-deferred.

HSA’s

A health savings account (HSA) combines high deductible health insurance with a tax-favored savings account. Money in the savings account can help pay the deductible. Once the deductible is met, the insurance starts paying. Money left in the savings account earns interest and can roll over annually.

HSA Benefits

High Deductible Health Plan:

  • Costs less than more “traditional” copay plans.
  • Provides quality health insurance.
  • One calendar-year deductible per family.

HSA Savings:

  • Used to meet your deductible.
  • Tax deductible off of gross income.
  • Grow tax-deferred.
  • NEVER taxed when used for qualified medical expenses.
  • Rolls over year after year – no “use it or lose it”.
  • Portable, goes with you wherever you go.

HSA Savings can also be used for:

  • Health insurance premiums when you’re between jobs.
  • Qualified long-term care premiums.
  • Medicare premiums and out-of-pocket expenses.
  • Living expenses after age 65 (pay ordinary income taxes).
2020 LimitsMinimum DeductibleMaximum Out-of-PocketContribution Limit55+ Contribution Catch Up
Single$1,350$6,750$3,550$1,000
Family$2,700$13,500$7,100$1,000

Health Savings Accounts (HSA) are subject to limitations and/or penalties imposed by the Internal Revenue Service. Please see your HSA Agreement or tax advisor for additional information.

Posted on by Nicole Donegan July 15, 2019