Archer Medical Savings Account

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Archer Medical Savings Account

An account into which one makes tax-deferred contributions that can be used for present and future medical expenses. An Archer MSA is used in conjunction with an insurance policy with a high deductible. An Archer MSA may be used in order to offset the high deductible on one's other insurance policy.

One does not pay taxes on withdrawals from a health savings account, unless one withdraws funds for a non-medical reason, in which case they are taxed as ordinary income. If one is under 65, there may also be a penalty associated with a non-medical withdrawal.
References in periodicals archive ?
8K * 'MSA' refers to Archer Medical Savings Accounts, which were authorized prior to 2004.
An increase in the tax on individuals who make withdrawals from their HSAs or Archer medical savings accounts prior to age 65 to 20%.
2010-23) implementing the Patient Protection and Affordable Care Act's prohibition on reimbursement of the cost of over-the-counter (OTC) drugs by health savings accounts (HSAs), health retirement accounts (HRAs), Archer medical savings accounts (MSAs), and flexible spending accounts (FSAs).
A similar rule goes into effect January 1,2011, for health savings accounts and Archer medical savings accounts.
Effective in 2011, distributions from an HSA or Archer Medical Savings Accounts not used to pay qualifying medical expenses will be subject to an additional 20 percent tax.
HSAs, Archer Medical Savings Accounts (MSAs), FSAs, and Health Reimbursement Arrangements (HRAs) are all defined and presented in great detail in this publication.
By mid-2005, about one year after implementation, the plans had already surpassed the peak market penetration achieved over nearly 10 years by their predecessor, the Archer Medical Savings Accounts, said Karen Ignagni, president and chief executive officer of America's Health Insurance Plans.
Despite the push for tax breaks, AIPB says many expired in 2005: * The 15-year straight-line cost recovery for qualified leasehold improvements and qualified restaurant improvements; * The research and experimentation tax credit; * The work opportunity tax credit; * The welfare-to-work tax credits; * Parity in the application of certain limits to mental health benefits; * State and local general sales tax deductions; * Archer medical savings accounts (MSAs); * Above-the-line deduction for certain higher education expenses; * Election to include combat pay as earned income for purposes of the earned income credit.
Similar set-ups, the Archer Medical Savings Accounts, for instance, have been around for a while.
HSAs were modeled after the Archer Medical Savings Accounts (MSAs).
Eligible accounts include traditional and Roth IRAs, health savings accounts, Archer medical savings accounts, Coverdell education savings accounts, and qualified tuition programs (529 plans).
Created by the Medicare Modernization Act, which was signed by President Bush in December 2003, health savings accounts have in one year already surpassed the peak market penetration achieved over nearly 10 years by their predecessor, the Archer Medical Savings Accounts, noted Karen Ignagni, AHIP's president and chief executive officer.