Flexible Spending Account (FSA)

        Health Savings Account (HSA)

• Best used when you expect major medical expenses such as surgery or braces.

• Best used when you are mostly healthy and want to save for future medical expenses.

• Based on your tax bracket your deduction could save as much as 35%.

• Based on your tax bracket your deduction could save as much as 35%.

• This plan is available only through an employer.

• May be offered by employer.  Individuals and self-employed may also use this plan.

• Usually partnered with a health insurance plan that has smaller deductibles such as $500.

• Must be partnered with High Deductible Health Plan (HDHP).  The lowest deductible for a single is $1,300 and family is $2,600.

• You can deduct up to $2,550 from your paycheck per year. The maximum is the same for singles and families.

• You may deduct contributions of up to $3,350 for single and $6,650 for a family each year. An extra $1,000 is available for those over 55.

• Must ‘use it or lose it’ each year! Your employer may allow for $500 rollover into the next plan year OR an additional two months extension to use your benefit.

• No “lose it” with this account. No limit on the amount you can accumulate.  However, to remain tax free, you can use this money only for medical expenses.

• You can withdrawal money before you can put it in, up to the amount you have chosen to contribute for the year

• You pay your medical expenses directly from the Health Savings Account.

• FSAs are tied to your employer and cannot be moved.

• HSAs are portable and can be moved.  If possible, keep HSA separate from your health insurance.  It makes changing insurance easier.