2012 HSA and FSA Contributions

What is a Health Savings Account?


A Health Savings Account (HSA) is similar to a personal savings account; however, money can only be used for health care expenses.  Money that is contributed to the HSA is not subject to federal income tax.  HSAs are only available to individuals who are enrolled in a qualified high deductible health plan.  Unused amounts in one year can be carried over to following years and added to future contributions.


HSA Contribution Limits


 HSA  2011 2012  Change
 Individual Coverage  $3,050  $3,100 +$50
 Family Coverage  $6,150  $6,250  +$100







High Deductible Health Plan (HDHP) Minimum Required Deductibles

Self Only: $1,200

Family: $2,400


High Deductible Health Plan Out-of-Pocket Maximum

Self-only: $6,050 (a $100 increase from 2011)

Family: $12,100 (a $200 increase from 2011)


What is a Flexible Spending Account?

A Flexible Spending Account (FSA) is also a great way to pay for health care expenses using pre-tax money.  Unlike health savings accounts or health reimbursement accounts, FSAs are more commonly offered with traditional medical plans.  The FSA can cover costs such as deductibles, co-pays and coinsurance.  Money that is placed in a FSA must be used by the end of year.  If an individual does not use all of the money, it goes back to the employer.


FSA Contribution Limits

2012 is the last year that there are no limits.  A plan must have either a maximum dollar amount or maximum percentage that can be contributed to the FSA.  Starting in 2013, the new health care law will limit FSA contributions to $2,500 a year per employee, with annual inflation increases.


This Focus Benefits Flash is not intended to be legal, accounting or other professional advice.  Please consult a tax professional for advice regarding your individual situation.

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