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Health Savings Accounts (HSA)

5.25% interest rate effective through June 30, 2008 (adjustable every January 1 and July 1)

A Tax Advantage to Offset Health Care Expenses

In an effort to combat rising medical costs Congress created HSA’s to provide consumers an incentive to pay “first-dollar” medical expenses. HSA’s are IRA-like accounts designed exclusively for covering medical expenses.

To be eligible an individual must be covered by a high deductible health plan (HDHP) and not enrolled for benefits under Medicare (generally not yet age 65). Contact your health plan administrator to see if your health plan qualifies as a HDHP.

Tax Benefits

Contributions are excluded from income
Earnings are tax deferred
If used for qualified medical expenses assets are never taxed
Unused assets may be used for retirement at or after age 65. If not used for medical expenses will be subject to income tax.
Subject to 10% penalty if withdrawn before age 65 for non-medical expense purposes and subject to income tax.
Upon death, assets are part of estate or transferred to named beneficiary.

As with all National Covenant Properties investment accounts there are no fees charged by NCP.