To be eligible for a Health Savings Account, an individual must be covered by a High Deductible Health Plan (HDHP), must not be covered by any other health insurance, is not eligible for Medicare, and can’t be claimed as a dependent on another individual’s tax return.

A HDHP is a health insurance plan with a minimum deductible of $1,650 (self-only coverage) or $3,300 (family coverage). The annual out-of-pocket expenses (including deductibles and co-pays) cannot exceed $8,300 (self-only coverage) or $16,600 (family coverage). These are the 2025 figures. HDHPs can have first dollar coverage (no deductible) for preventative care and higher out-of-pocket (copays & coinsurance) for non-network services.

The maximum amount for self-only coverage is $4,300 and $8,550 for family coverage. If you are 55 years of age or older, you may contribute $1,000 as a catch-up contribution.  These amounts are for 2025 and change annually for inflation.

Contributions to a HSA can be made by you, your employer, or any other person for your benefit. The combined contributions each year cannot exceed the maximum set by the IRS. Contributions can be made through payroll deduction, transfer from another First Federal Savings Bank account, by mail, or in person.

No. There are no “use it or lose it” rules associated with HSAs. Balances in your HSA roll over from year-to-year.

Qualified medical expenses are those expenses that would generally qualify for the medical and dental expense deduction. Examples include amounts paid for doctors’ fees, prescription medicines, and necessary hospital services not paid for by insurance. For more detailed information, please refer to IRS Publication 502 titled, “Medical and Dental Expenses”. If you still have questions, please consult your tax adviser.

You can use the money in your HSA to pay for qualified medical expenses of yourself, your spouse, or your dependent children even if your spouse or dependent children are not covered by your HDHP.

You are able to access your HSA by using checks or your First Federal Savings Bank’s Visa debit card. You can even stop by one of our convenient locations.

If you use the money for any other reason, you will need to include that amount in your gross income when you file your taxes. It will be treated as regular income and will be subject to a 20% tax penalty (unless you are disabled or age 65 or over). It is your responsibility to keep supporting records to show the IRS that funds were used to pay for qualified medical expenses. Remember, your HSA money is tax-free as long as it is used to pay for qualified medical expenses.

The HSA and all contributions are owned by the individual. It is yours even if you change jobs, change medical coverage, leave the workforce, move to another state, or change your marital status.