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Health Savings Accounts

Health Savings Accounts provide a smarter way to save for your medical expenses

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A Health Savings Account lets you put aside money for medical expenses tax free. Your contributions, interest earnings, and withdrawals are tax free in most cases. Your money will also earn a great rate!

Choose From Two Types Of Health Savings Accounts

  • Our HSA Checking comes with a debit card and checks to easily access funds and pay your medical expenses. It offers tiered interest rates that increase for higher balances.
  • Our HSA Certificate is a 12-month certificate. Your balance earns a high interest rate in exchange for not withdrawing funds for 12 months.

Benefits Of Having An HSA

  • Whether you contribute to an HSA account from your paycheck before taxes or from your take-home pay, you won’t pay income tax. This can also reduce your taxable income.
  • Download the form to start setting up direct deposit.
  • Any interest your HSA earns is not taxed. With Royal’s great rates, this can add up to substantial savings.
  • When you use HSA account dollars for a qualified medical expense, your withdrawal is tax free.
  • HSA funds roll over from year to year. If you don’t use the funds, they’ll remain in the account, unlike a Flexible Spending Account with a “use it or lose it” rule.
  • HSA money is portable. Even if you leave your job or move, you can take your HSA with you.
  • HSAs may provide a tax-advantaged way to save for medical expenses in retirement.

Who Can Have An HSA?

  • To have a Health Savings Account, you must be enrolled in a high-deductible health plan, also known as an HDHP. The IRS sets limits on the minimum deductibles and out-of-pocket maximums a health plan may have to qualify as an HDHP. These limits are outlined in the table below.
  • You also may not have other health coverage, be enrolled in Medicare, or be claimed as a dependent on someone else’s tax return this year.

HSA Checking Rate

Balance
Dividend Rate
APY

HSA Certificate Rate

Term
Dividend
APY

Saving At A Young Age

HSA contribution limits

Each year, the IRS adjusts the limits on HSA contributions to keep up with inflation. See the limit information in the table below. It’s important to note that these limits apply to your contributions plus any contribution or match made by your employer. If you would like to see the 2020 limits, please click here.

2019 HSA Contribution Limits

Self-only

Family

HSA contribution limit (employer + employee)

$3,500

$7,000

HSA catch-up contributions (age 55 or older)

$1,000

 

HDHP minimum deductibles

$1,350

$2,700

HDHP maximum out-of-pocket amounts (deductibles, co-payments and other
amounts, but not premiums)

$6,750

$13,500

Source: IRS, Revenue Procedure 2019-25. Consult a tax professional. Royal Credit Union does not provide tax advice.​

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