High-Deductible Health Plans and Health Savings Accounts: Tax-Free Medical Savings
A new option to reduce your health care costs is the combination of a high deductible health plan (HDHP) and a health savings accounts (HSA). To qualify for an HSA, you must have an HDHP. What is an HDHP? The HDHP is a health insurance policy that features a higher annual deductible than traditional health plans. What is an HSA?
Why were HSAs created?
Health Savings Accounts were created to help individuals and families save for qualified medical expenses on a tax-free basis. Health Savings Accounts can be used for medical expenses, such as prescriptions, eye care, dental and some over-the-counter medications.
The funds contributed to your HSA are tax-deductible, reducing your taxable income. IRA INNOVATIONs self-directed health savings accounts are earnings with a bonus. Most HSAs provide only savings or money market accounts, limiting what your HSA can earn.
With an IRA INNOVATIONs self-directed HSA, you can self-direct your funds into real estate, mortgages, limited partnerships, mutual funds and more. You have complete control and may direct your funds into investments that you know offer maximum growth, ensuring financial security for when you need it the most.
Unlike a Flexible Spending Account (FSA), an HSA is not a “use it or lose it” account.
Should You Consider a Health Savings Account?
Absolutely, if you meet the following conditions:
- You have a high-deductible health plan.
- You are generally not covered by any health plan that is not a high- deductible plan.
- You are not enrolled in Medicare.
- You may not be claimed as a dependent on another persons tax return.
The amount you can contribute depends on whether you’re contributing on behalf of yourself or your family.
Call IRA Innovations at (205) 985-0860 and get started on your self-directed IRA today.
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