Health Savings Account (HSA)
If you enroll in one of the High Deductible Health Plans (HDHP), you may be eligible to open a Health Savings Account (HSA)
through Optum Bank. An HSA allows you to set aside tax-free dollars through payroll deductions to conveniently pay for
eligible expenses.
What are the benefits of an HSA?
- The State of Colorado contributes FREE money to your account.
- You can now make pre-tax or post-tax contributions to your HSA.
- An HSA is your bank account. If you leave the company, the account goes with you.
- All unused funds roll over year to year.
- HSAs can make a great retirement savings account.
- Employer funds will be deposited prospectively and one month
in arrears.
Are HSAs Really Tax-free?
Yes! HSAs give you a triple tax advantage:
- Your contributions are tax deductible
- Payments of qualified expenses are tax-free
- Earnings are tax-free
Contributions
You can contribute funds from your paycheck up to the annual IRS limits. To receive the State of Colorado contributions, you
must first open an HSA through Optum Bank.
| Coverage Type | 2020 Employer HSA Contribution |
2020 Maximum Employee Contribution |
2020 IRS Contribution Limit |
||||
|---|---|---|---|---|---|---|---|
| Individual Coverage | $720 | $2,830 | $3,550 | ||||
| Family Coverage | $720 | $6,380 | $7,100 | ||||
| Age 55+ Catch-up Contribution | Additional $1,000 | ||||||
Watch Your Balance Grow
Once your HSA balance reaches the investment threshold, you may choose to invest your HSA funds and earn interest tax-free.
The Fine Print
- You must be enrolled in a qualified High Deductible Health Plan (HDHP).
- You cannot be covered under another non-qualified health plan, including your spouse’s Health Care Flexible Spending Account.
- You cannot be enrolled in Medicare or Tricare.
- You cannot be claimed as a dependent on someone else’s tax return.
Questions? Refer to IRS Publication 969 for complete HSA rules. Other exclusions may apply. Contact Optum Bank.
