Smart Benefits: How to Leverage Amazon’s Announcement to Boost HSA Use
Monday, June 03, 2019
In March, Amazon announced it would start accepting HSA dollars. Participants can simply add their HSA card as a payment method and shop for eligible items. With HSA use made even easier through the online shopping giant, now is a good time for employers to remind employees about the benefits of HSAs to maximize their value:
- Triple-Tax Benefit: For employees, contributions are tax deductible (or pretax if made through payroll deduction), savings grow tax free, and withdrawals on qualified expenses are also not taxed.
- Long-Term Savings: An HSA can be part of a longer-term investment strategy because the funds roll over from year to year.
- Eligible Expenses: Participants can withdraw HSA funds tax-free to pay for eligible medical expenses. And the list of what the money can be used for, listed in IRS Publication 502, is extensive.
- Portability: The plans are owned by the individual so they move with employees if they change jobs or leave the workforce.
Not only do HSAs benefit employees, but employers win as well since their contributions are tax deductible and, if employees contribute pre-tax through payroll, the company saves on payroll taxes. Plus, the plans encourage participants to make better healthcare spending decisions.
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