 TITLE: What Is a Health Savings Account (HSA)? CONTENT: Benefits of an HSA\n------------------\nAn HSA provides a triple tax benefit to individuals—a rarity, even among tax-advantaged accounts:\n*   You can take a **federal income tax deduction** for contributions to your HSA.\n*   You can earn **tax-free interest or investment gains** within your HSA.\n*   You can make a **tax-free withdrawal** if you use the money to pay for qualified medical expenses\nIf someone contributes to your HSA on your behalf, you may still be able to claim the deduction. And employer contributions are generally excluded from your income. However, the impact on your state taxes can vary, as some states may tax your HSA contributions or earnings.\nAnother benefit is that you don't have to use the funds in your HSA right away. If you have the funds to cover a medical expense, you can keep your money growing in an HSA, knowing that you can withdraw the money tax-free later. Keep your receipts as proof of having a qualified medical expense to match the withdrawal.\nAdditionally, some HSA providers give you the option of investing the money in your account. You could, therefore, treat the account as a long-term retirement account (for post-retirement medical expenses) with the benefit of tax-free withdrawals. However, you might not want to risk the money by investing it if you may need it for short-term medical bills. END