Posted on January - 17 - 2012
The Basics of the Health Spending Account
With health care costs increasing every year, an entrepreneur reader emailed me to ask about the Health Spending Account (HSA). The HSA is basically a registered account with a CCPC that allows an employee of that company to receive tax free health benefits. In addition to the tax free benefit to employees, the company funds the HSA with pre-tax dollars, which means there is 0% tax paid overall on the health benefit.
What are the Benefits
A funded HSA can be used by employees, their spouses and their dependents towards medical or dental expenses. It can be used in conjunction with health insurance to cover the deductible or as a stand alone benefit. Putting my employee hat on, I can see this as a real perk, especially since it’s a tax free benefit, in other words, free money! In addition, if the health insurance plan is on the lighter side (ie. no orthode