As a business owner, offering a health savings account (HSA) is a great way to show employees how much you care about their health and well-being. HSAs help employees keep medical expenses at a minimum and allow them to set aside pre-tax dollars into a tax-advantaged savings account for future medical expenses.
Qualified participants save by using untaxed funds to cover the costs of health care, insurance copays and other health-related costs not handled by insurance companies. While it may seem HSAs only benefit employees, business owners may also see the following advantages from offering HSAs:
Cost savings. Considering HSAs are a part of high-deductible health plans (HDHPs), they save the business money on premium health insurance features. HDHPs allow employees to have more control over their own health-related needs, so they are not paying for unnecessary coverage. As an employer, you can also use an HSA as a perk by adding it to an employee’s benefits package in exchange for lower wages.
Reduced tax burdens. Neither the employer nor the employee is obligated to pay taxes on HSA contributions that are deducted from income. Any contribution you, as the employer, make into your employees’ HSAs will receive an immediate federal tax deduction. You can then put the money you save back into business needs other than health care.
Increased employee satisfaction. If your employees can save on their taxes and have more disposable income, they will be happier — and likely more eager to put their time and effort into a company that values them.
Beneficial partnerships. In order to create an HSA for your business, you can start a relationship with a financial institution. You can then take that initial relationship and grow your business by securing loans and other necessary business accounts. This important partnership can improve your credit and financial stability as well.
The great benefits for both you and your employees that come with an HSA makes the decision to start one a no-brainer.
Visit u1cu.org/hsa to learn more about health savings accounts at Universal 1 Credit Union.
Universal 1 Credit Union (U1CU) supports local businesses with essential checking and savings accounts. To get started and learn what’s needed, contact U1 Member Support at (800) 543-5000 option 0 or email memberservices@u1cu.org. Member support is available from Monday to Friday from 9 a.m. to 5 p.m. and on Saturdays from 9 a.m. to 12 p.m.