Clinic

Saving for Healthcare

Tax-advantaged accounts that allow you to save specifically for medical costs

 

Which account is right for you?

Health Savings Account
(HSA)
Flexible Spending Account
(FSA)

Control

Owned by the employee

Owned by the employer

Control

Control

Health Reimbursement Account
(HRA)

Owned by the employer

Employer & employee funded

Funding

Funding

Funding

Employer & employee funded

100% employer funded

Contribution Limits

$3,600 single, $7,200 family

Contribution Limits

Contribution Limits

Medical FSAs: $2,750

Dependent Care FSAs: $10,500

Determined by the employer

Must be enrolled in a High-Deductible Health Plan

Health Plan Eligibility

Health Plan Eligibility

Health Plan Eligibility

Must be offered a group health plan by employer

Can be built to work with any health plan

Fund Availability

As they're contributed

Fund Availability

Fund Availability

Medical FSAs: On first day of plan year

Dependent Care FSAs: As they're contributed

X

Contributions are pretax or tax-deductible. Growth & qualified distributions are tax-free.

Tax Savings

Tax Savings

Tax Savings

Contributions are pre-tax & qualified distributions are tax-free

X

Rollover

Unused balances rollover into the next year

Rollover

Rollover

You forfeit any unused balance unless your employer allows a rollover ($500 cap)

Yes, if allowed by employer plan

Yes

Investment Capability

Investment Capability

Investment Capability

No

No

Portability

Yes, HSA stays with the account holder

Portability

Portability

No

No

IRS-approved medical/dental/vision expenses for participant and qualified dependents

Covered Expenses

Covered Expenses

Covered Expenses

IRS-approved medical/dental/vision expenses or qualified dependent care expenses.

Employer-approved expenses for employee and qualified dependents

Health Savings Account (HSA)

A Health Savings Account is a type of savings account that lets you set aside money on a pre-tax basis to pay for qualified medical expenses.

  • Triple Tax Benefits 

    1. Contribute pre-tax money​

    2. Enjoy tax-free growth

    3. Withdrawals for qualified uses are tax-free

  • The "Health IRA"

    • It can be used to help boost retirement savings

    • Contributions can often be invested into funds

    • No Required Minimum Distributions (RMDs)

  • Flexible

    • Uses include: co-pays, deductibles, etc.​

    • Unused funds rollover to the next year

    • You own it so it's portable

 

Flexible Spending Account (FSA)

Flexible spending accounts come only as part of a benefits package from an employer — you can’t get one on your own — but the medical expenses you can use them for are the same as HSAs. 

 

It is an arrangement through your employer that lets you pay for many out-of-pocket medical expenses with tax-free dollars.

What's the advantage to the employee?

  • Contributions are pre-tax

  • Can make incremental contributions, but can still use the full annual amount right away

 

What's the advantage for employers?

  • Can choose to contribute or not

  • Can choose to allow some unused money to rollover

 

Health Reimbursement Account (HRA)

Health Reimbursement Accounts (HRAs) are employer-funded group health plans from which employees are reimbursed tax-free for qualified medical expenses up to a fixed dollar amount per year.

 

The employer funds and owns the arrangement.

 

What's the advantage to the employee?

  • Employer contributions are not part of wages, so they are tax-free

  • Unused money may rollover, employer decides how much

What's the advantage for employers?

  • Contributions are tax deductible

  • Can choose which qualified medical expenses money can be used for

  • Can choose if money rolls over at the  end of the year

Have Questions?

 

Use our online calendar to schedule a complimentary virtual financial consultation today!

If you, or someone you know, is in need of financial advice right now, follow the link below to schedule your complimentary virtual consultation.

 

No obligation or commitments required.

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