What is an HDHP and why do I need one?
Health Savings Accounts are always coupled with a High Deductible Health Plan (HDHP). HDHPs feature much lower premium payments than typical Low Deductible Plans.
Which contribution tax year should I choose?
You may open or fund your HSA any time during the tax year until your federal tax return is due. Normally this is April 15 of the following year, excluding extensions.
How much can I contribute to an HSA?
You are permitted to annually contribute the following maximum amounts based on your type of coverage:
| Maximum Maximum Contribution Limits* | |||
| Tax Year | Self-Only Coverage | Family Coverage | Age 55+ Catch Up Allowed |
| 2025 | $4,300 | $8,550 | $1,000 |
**indexed annually for inflation
When can I withdraw from an HSA?
You may receive a tax-free distribution from your HSA at any time to help pay for qualified medical expenses. Funds remaining in your HSA that are not withdrawn to help pay for qualified medical expenses will continue to grow over time.
If you withdraw money before reaching age 65, and that money is not used to pay for qualified medical expenses, a 20% penalty will be assessed to the distribution. After reaching age 65 you may withdraw the money for any purpose without penalty, but you will pay income tax on the amount withdrawn if that money is not used to pay for qualifying medical expenses.
If I die, what happens to my HSA?
You will be asked to designate a beneficiary when you set up your HSA. If your spouse is the designated beneficiary, then the HSA will be treated as your spouse’s after your death. If you designated anyone other than your spouse as the beneficiary, then after your death the account will no longer be an HSA and the beneficiary will be taxed based on the account’s fair market value in the year of your death. If your estate is the beneficiary, then the value of the account will be included on your final income tax return.