A Health Savings Account (HSA) is a tax-advantaged savings account designed to help individuals with high-deductible health plans save for medical expenses. Contributions to an HSA are tax-deductible, and withdrawals for qualified medical expenses are tax-free, making it a powerful tool for managing healthcare costs and planning for future medical needs.

Health Savings Account

Tax-advantaged savings account

High-deductible health plans

Medical expenses refer to the costs incurred for the diagnosis, treatment, prevention, and management of health conditions. These expenses can include payments for services from physicians, hospital care, prescription drugs, and other healthcare needs, often impacting financial planning and insurance coverage decisions.

Medical Expenses

Tax-deductible contributions

Tax-free withdrawals allow individuals to access funds from certain accounts without incurring federal income tax, provided specific conditions are met. This feature is particularly beneficial for retirement savings, as it can significantly enhance the growth potential of investments by deferring taxes until withdrawal.

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