A Great On-Going Gift For Your Upcoming College Graduate
I recently had a conversation with a colleague who has established what he calls a Gift HSA. His website is found at http://www.theoriginalgifthsa.com. The use of a Health Savings Account ("HSA") has increased over the years.
Just as a brief overview, a HSA is established and presently can be funded up to $3,000 in 2009 for individuals and up to $5,950 for families. Additionally, a high deductible health plan is purchased. The owner of the HSA gets a tax saving on the contribution and tax-free distribution when funds are used for qualified medical expenses. The money grows tax-free in the account and to the extent it is unused, the money can be left to a beneficiary by designation. Sounds and works much like the ever popular IRA.
The whole concept behind the Gift HSA is that you set up the Health Savings Account for a loved one, fund it annually and pay the annual premium on the high deductible health plan, using your annual exclusion gifting (currently $13,000 for individuals and $26,000 for married couples).
What a great gift to the graduating loved one soon to be off your health insurance. You give them the comfort of having health insurance while also potentially providing tax-free growth. It's a great ongoing gift for your upcoming college graduate.
