A Health Savings Account (HSA) is a savings account that belongs to you that is paired with a HDHP. It allows you to make tax-free contributions that you can use to pay for current and future healthcare expenses for you and your dependents. It can also be a valuable retirement account.
Health Savings Account (HSA)
A Health Savings Account (HSA) is a way for you to save pre-tax dollars that can be used to pay for qualified healthcare expenses like deductibles, copays, co-insurance, prescriptions, vision, and dental expenses. They are paired with high deductible health plans that have lower premiums and may result in lower annual medical costs. These plans offer several advantages to reward you for taking an active role in your healthcare spending.
What are Qualified Medical Expenses?
A full description of qualified HSA expenditures can be found in IRS Publication 502 and is located online at www.irs.gov/pub/irs-pdf/p502.pdf
To open your HSA account:
For new associates joining the health plan, please contact the HSA Authority at UMB Bank: 888-472-8697. They will assist you in opening up a Health Savings Account (HSA) or you may contact Human Resources for more information. If you prefer enrolling online, click the link below.
Save in taxes, three ways:
- Your chosen contribution is deducted from your paycheck before taxes
- Any growth earnings are tax-free
- Money you take out for health care expenses is also tax-free
Keep your money every year:
The unused funds in your account roll over from year to year, and the account is still yours, even if you leave the company.
Control your own account:
You can use the money whenever you want, to pay for eligible health care expenses now, or to save for such expenses in your retirement. You can start, change, or stop your contributions at any time.
HSAs and Taxes:
All withdrawals from your HSA are generally tax-free, as long as you use the money to pay for eligible health care expenses. In addition, all the money in the account is yours and will never be forfeited. It rolls over from year to year, and you can take it with you if you leave the company or retire. After age 65, you can withdraw funds for any reason without a tax penalty - you pay ordinary income tax only if the withdrawal isn’t for eligible health care expenses.
Note: You won’t pay federal taxes on HSA contributions. However, you may pay state taxes depending on your residence. Consult your tax advisor to learn more.
When your HSA balance reached $1,000, you can invest the funds in a variety of options available through UMB Bank!
The HSA is not for everyone. You’re eligible only if you are:
- Enrolled in the High Deductible Health Plan (HDHP)
- Not enrolled in other non-HDHP medical coverage, including Medicare, Medicaid, or Tricare.
- Not a tax dependent.
- Not enrolled in a healthcare Flexible Spending Account (FSA), unless it’s a “limited purpose” FSA for dental and vision expenses.
- Cannot be a veteran who has received treatment, other than preventive care, through the Department of Veterans Affairs within the past three months
A Health Savings Account (HSA) is an easy way to pay for healthcare expenses that you have today and save for expenses you may have in the future.
Incentives for the Health Savings Account (HSA):
Earn wellness incentives for your Health Savings Account (HSA). Welch Packaging wellness incentives include money earned for an annual physical and different wellness activities:
- Associates may earn $400 in HSA money simply by completing an annual physical exam with their physician.
- Associates may earn $100 per wellness activity up to a maximum of three ($300) per year.
- Associates who complete a smoking cessation class may earn a one-time reward of $100 in lieu of completing other activities.
When making your annual election for deposits into your Health Savings Account (HSA), please consider the Wellness Incentives above. See your HR person for a complete list of incentives!
Remember, the maximum amounts you can contribute to the HSA in 2026 are as follows:
- $4,400 if you have single coverage on your health plan
- $8,750 if you cover any family members on your health plan
- $1,000 additional if you are age 55 or older
Four Reasons to Love an HSA
1
Tax-free. No federal tax on contributions, or state tax in most states. Withdrawals are also tax-free as long as they’re for eligible healthcare expenses.
2
No “use it or lose it.” Your balance rolls over from year to year. You own the account and can continue to use it even if you change medical plans or leave the company.
3
Use it now or later. Use your HSA for healthcare expenses you have today or save it to use in the future.
4
Boosts retirement savings. After you retire, you can use your HSA for healthcare expenses tax-free, or for regular living expenses, taxable but no penalties.
NOTE: If HSA money is used for ineligible expenses, you will pay ordinary income tax on the amount withdrawn plus a 20% penalty tax if you withdraw before age 65. After age 65, withdrawals for ineligible expenses are only subject to ordinary income tax. For a list of eligible HSA expenses, see IRS Publications 502 and 503.
