Health_savings_accounts - Health savings accounts....

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Health savings accounts . Taxpayers were able to sign up for Health Savings Accounts (HSA) beginning in 2004, though similar accounts had existed before that (i.e., Archer Medical Savings Accounts). When you deposit money into an account, you pay no federal income taxes on the money you deposit, it grows tax-free in the account and there’s no tax on the earnings when you tap into the account to pay for qualified medical expenses. It’s a rare triple play in the world of tax breaks. Why were HSA’s created in the first place? The idea was that if people had to pay more out of pocket each year, they’d have an incentive to shop around and be less wasteful with their health care spending. The cumulative effect of millions of people doing that would supposedly lower costs. Tax savings from the accounts, meanwhile, would lure the uninsured into high-deductible plans, which often have lower premiums. And if the new enrollees were young and healthy, their premiums could subsidize coverage for the
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 2

Health_savings_accounts - Health savings accounts....

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online