Health Savings Accounts
To help you deal with the continuing rise in health insurance premiums, American Fidelity offers an HSA program that allows you to save money, and gives your employees the option to take control of their own healthcare costs.
An HSA is a tax-favored "IRA-type" of account that helps pay for the medical expenses of your employees and their dependents. When set up with a Section 125 Cafeteria Plan, an HSA is pre-taxed and can provide significant FICA savings for both you and your employees. You must offer − and your employees must be participating in − a Qualified High-Deductible Health Plan (HDHP) to contribute to an HSA. In addition, earned interest on an HSA is tax-free.
HSA Tax Advantages
One of the best features of an HSA is the tax savings potential - tax-free contributions, earnings and distributions. Participants can make tax-free HSA contributions that are deducted from their paycheck under your Section 125 Cafeteria Plan, which can result in tax savings for both you and your employees. Also, any funds that remain in the account will accumulate tax-free interest, and as long as the money is taken out for a qualified expense, reimbursements are also tax-free.
Advantage of Partnering with American Fidelity
American Fidelity believes that it is important to understand all the fees associated with your HSA including any hidden or back-end fees. Many HSA vendors typically charge fees to HSAs that apply to regular checking accounts such as overdraft fees, stop payment fees, researching fees, etc. American Fidelity handles the majority of account administration through one monthly maintenance fee, so participants do not have to worry about being charged for regular account activity.