However, in the Zero Balance
savings account, you need not maintain a minimum balance.
The health
savings account program gives taxpayers who buy eligible health coverage with minimum deductibles a chance to put cash in a special fund without paying federal income taxes on the contribution.
Paul Stokes, head of products at M&S Bank, said: "It's great that the vast majority hold
savings accounts and, more importantly, half are choosing to save regularly.
These exclusions of pooled trusts and investment designations might impact the way people with disabilities are able to maximize the benefits of setting up one of these
savings accounts.
For example, according to Revenue Ruling 2004-38, combining a prescription drug card with a High Deductible Health Plan will disqualify the policyholder from participating in a Health
Savings Account.
Rather than raiding the piggy bank we suggest factoring these unforeseen costs into the annual budget, this way
savings accounts aren't affected when emergencies crop up.
Another worry is that people will opt for the high-deductible insurance, but have nothing to invest in the health
savings account to help them pay that large deductible.
Basically, medical costs are rising so fast that a health
savings account simply will not be able to keep up.
Employers can match employee health
savings account contributions, but less generously than the qualified retirement plan match.
Created by the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, the Health
Savings Account (HSA) offers advantages over other savings vehicles--it is not limited to employees of small businesses and the self-employed, the unspent balance rolls over at year-end for further use, and the account is portable because it is owned by the individual.
What is a health
savings account (HSA) program, and what can it do for my business?
Nearly three-quarters of the respondents said it was very likely or somewhat likely that they would offer a high-deductible health plan with a health
savings account by 2006.