A health savings account (HSA) is a tax-advantaged savings account that accumulates funds contributed by you and/or your employer to cover your health care expenses, and is only available if you are enrolled in a High-Deductible Health Plan (HDHP). A HDHP is a consumer-driven health plan that is designed to empower you to take control of your health and the dollars you spend on your care.
In general, to be an eligible individual and qualify for an HSA, you must meet the following requirements:
- Must be covered under a High Deductible Health Plan (HDHP PPO $3,500 or HDHP HMO $3,500)
- Have no other health coverage
- Not enrolled in Medicare or Veteran’s Affairs benefits
- Cannot be claimed as a dependent on someone else’s tax return
How you can benefit from a Health Savings Account:
Qualifying plans typically have lower premiums
Can be used prior to retirement for eligible medical expenses
Contribute pre-tax funds
Your HSA balance rolls over every year
Your account is yours even if you change jobs, insurance plans or retire
Balance can be invested in mutual funds
2025 Annual Maximum HSA Contributions
Did you know that Round Rock ISD will contribute $42 a month if you are eligible, enrolled in one of the High Deductible Health plans and elected an HSA? You do not need to contribute anything to a HSA in order to receive the district’s contribution. This amount is included in the maximum you can contribute for 2025. $42/month will be deposited to your HSA account for each full month of HDHP coverage. This employer portion counts toward your annual HSA maximum contribution. Considering a full year of Round Rock ISD contributions to your account, the maximum you can contribute through payroll would be:
If you are enrolled in Employee Only Coverage on the HDHP:
$316.33 month
If you have any dependents enrolled with you on HDHP:
$670.50 month
Note: Those age 55 and older can contribute an additional $1,000 per year. Contact the HSA provider for direct payment.
2024 Annual Maximum HSA Contributions
Did you know that Round Rock ISD will contribute $42 a month if you are eligible, enrolled in one of the High Deductible Health plans and elected an HSA? You do not need to contribute anything to a HSA in order to receive the district’s contribution. This amount is included in the maximum you can contribute for 2024. $42/month will be deposited to your HSA account for each full month of HDHP coverage. This employer portion counts toward your annual HSA maximum contribution. Considering a full year of Round Rock ISD contributions to your account, the maximum you can contribute through payroll would be:
If you are enrolled in Employee Only Coverage on the HDHP:
$303.83 month
If you have any dependents enrolled with you on HDHP:
$649.67 month
Note: Those age 55 and older can contribute an additional $1,000 per year. Contact the HSA provider for direct payment.
Contributions to your HSA
You may change the amount you are contributing to your HSA once a month. Additionally, may enroll in a HSA at anytime during the year. New enrollees must take steps to open their account when notified by the HSA provider. Speak to a Benefit Specialist for further assistance by emailing benefits@roundrockisd.org
You may contribute to your HSA either through payroll deduction on a pre-tax basis, and/or you can make deposits directly to the HSA provider, and receive the tax break on your tax return. HSA contributions are tax-free on a Federal basis in all states.
To exercise flexibility in changing your contributions throughout the year, you may consider making deposits direct with the HSA Provider instead of, or in conjunction with, your pre-tax payroll deductions.
HSA Distribution Rules
- Debit cards are mailed to your home address on file in the Employee Self Service (ESS). Make sure your address is up-to-date in the ESS.
- Debit cards are not pre-loaded. Funds are deposited in your HSA account after the payroll processing and are based on your monthly election amount.
- Distributions from your HSA are tax-free for “qualified medical expenses.”
- Cannot be enrolled in a Flex Savings Account for Medical in the same tax year.
- A list of qualified medical expenses can be found in Section 213(d) of the Internal Revenue Code, or for a more detailed list review IRS Publication 502.
- Medical expenses incurred by or on behalf of domestic partners or their children are ineligible for tax-free reimbursement from an HSA unless the domestic partner qualifies as a dependent under IRC Section 152.
- If HSA funds are used for non-qualified medical expenses the amount withdrawn is subject to both income tax and a 20% penalty.
- Individuals must keep records sufficient to prove that eligible expenses were incurred in the case of an IRS audit. We recommend uploading receipts and/or EOB’s to the HSA Provider’s website.
- Withdrawals can be used to reimburse yourself for qualified medical expenses following the date the HSA account is opened. There is no set time limit in which you must reimburse yourself.
- More information is available in the Employee Benefits Guide, pages 11 and 12 or the HSA provider’s website.
- To view your funds, file claims or to contact the HSA provider you will need to set up your account online or download the mobile app. Accounts must be activated online prior to using the mobile app.