Tax Advantage Accounts
Health Savings Account
A Health Savings Account allows you to contribute money in a tax-free account for present and future medical and prescription drug expenses. Because these accounts have certain tax advantages, you must meet the following IRS requirements.
To be eligible for an HSA:
- You cannot be covered by any other health insurance except a high-deductible health plan (HDHP), such as the Consumer Choice PPO Plan.
- You cannot be enrolled in Medicare.
- You cannot be claimed as a dependent on someone else’s tax return.
An HSA Stays With You
When you enroll in and contribute tax-free money into an HSA, your unused funds roll over from year to year. Also, if you ever leave or retire from your job, your funds go with you.
A Three-Way Tax Advantage
- You can contribute to the account on a tax free basis — and receive monthly employer premium rebate credits. You decide when to spend or save your deposits.
- Your account earns interest right away — tax free! When you have a minimum account balance of $1,000, you can choose to invest in a wide selection of mutual funds offered through Bank of America.
- When you withdraw your funds to pay for eligible health care expenses, the funds are typically tax free.