Health Savings Account (HSA)
A Health Savings Account (HSA) is a tax-deductible transaction account that allows you to pay for qualified medical expenses, including those not covered by your insurance, and to save money for future health care costs. The account is the simple and smart accompaniment to a high-deductible insurance health plan (HDHP).
An HSA puts you in control of where and how your health care dollars are spent. Any unused funds rollover from year to year. Read more about HSAs below.
Steps to opening an HSA
Set-Up Your Account
- Download and print a copy of the disclosures listed below for your records:
- Health Savings Custodial Account Agreement (5305-C) and Disclosure Statement (pdf)
- Agreement for Deposit Accounts (pdf)
- Electronic Funds Transfer Notice of Disclosure (pdf)
- Truth in Savings Disclosure (pdf)
- USA Patriot Act
- Electronic Bill Payment Authorization & Disclosure (pdf)
- Privacy Notice (pdf)
- After clicking the Open An Account button below, please print and complete the application. You will need to sign your completed application in front of a Notary if you are not an existing 1st Source checking account client.
- If you will have an authorized signer on your account, please complete the Authorized Signer section on the application.
- Include a check for your initial deposit payable to 1st Source Bank (or you may wait for employer funding).
- Mail the forms and your deposit to:
1st Source Bank
Online Banking Department
205 W. Jefferson Blvd., Suite 100
South Bend, IN 46601
- After we receive your notarized documents and opening deposit, your HSA account will be opened and account materials will be mailed to you.
- Funds in the account can be spent on qualified medical expenses*
- Earn interest on your balances
- Free online banking and e-statements - go paperless!
- HSA Resource Plus® debit card
- Plus, a second free HSA debit card is available upon request for an authorized signer
- The monthly fee of $2.95 is waived with a direct deposit into a 1st Source checking account, or if you work for a HSA partner business
- The initial $25.00 set-up fee can be waived for groups or an HSA partner business
- Checks are available to order
- Deposits, up to the maximum annual contribution, made for qualified medical expenses are tax-deductible.
- Withdrawals used for qualified medical expenses are tax-free
- The interest earned is tax-deferred
- Your unspent funds carry over from year-to-year
- Your employer or insurance carrier may change, but you may always keep your funds at 1st Source.
*Qualified Medical Expenses are defined by Federal Employees Health Benefits law and Section 213 of the IRS Code. Information can be found here.
For additional details and guidance regarding HSAs please refer to IRS.gov and be sure to consult your tax advisor.
For additional tips and reminders regarding an HSA refer to this page.
- Covered under a high deductible health plan (HDHP) on the first day of the month
- Generally not covered by any health plan that is not an HDHP (exceptions exist for coverage that is not part of an HDHP for accidents, disability, dental care, vision care, long-term care, or permitted insurance)
- Not enrolled in Medicare
- Not able to be claimed as a dependent on another person’s tax return
Yes. A network plan is a plan that generally provides more favorable benefits for services provided by its network of providers than for services provided outside the network. When determining if a plan is an HDHP, the out-of-pocket expense limits for services provided outside of a network of preferred providers are disregarded. In other words, if a plan otherwise meets the requirements of an HDHP, but the out-of-pocket expense limits for out-of-network services exceed the maximum annual out-of-pocket expense limits allowed for an HDHP, the plan will still be considered an HDHP.
EXAMPLE: Is the plan described below an HDHP?
Sarah has self-only coverage under her health plan for 2019. She may access services from either a network of preferred providers, or she may choose to receive services from out-of-network providers. When she uses in-network providers, her health plan has a $1,350 deductible and a $4,000 out-of-pocket expense limit. Alternatively, when she accesses services from out-of-network providers, her deductible is $2,000, and her out-of-pocket expense limit is $12,000.
Answer: Yes. Sarah’s plan is an HDHP because it meets the deductible and out-of-pocket expense restrictions for self-only coverage when she uses network providers. Out-of-network provider expenses are disregarded when determining if an individual has an HDHP.