by admin | Nov 1, 2024 | Blog
Health Savings Accounts (HSAs) are not just for covering medical expenses—they can also be a powerful tool for long-term investment. Recently named as one of the Top HSA providers in 2024 by Morningstar, NueSynergy offers unique investment opportunities that can help you grow your savings while enjoying significant tax benefits. In this blog, we’ll explore how NueSynergy’s HSAs can be leveraged for investment purposes, providing a dual benefit of healthcare savings and wealth accumulation.
Tax Advantages of HSAs
One of the most compelling features of HSAs is their triple tax advantage:
- Tax-deductible contributions: Contributions to an HSA are made with pre-tax dollars, reducing your taxable income.
- Tax-free growth: Earnings from interest, dividends, and capital gains within the HSA are not taxed.
- Tax-free withdrawals: Withdrawals for qualified medical expenses are tax-free.
These benefits make HSAs more advantageous than traditional retirement accounts like 401(k)s and IRAs.
Investing with NueSynergy’s HSAs
NueSynergy stands out for its investment-friendly features. Here are some key points to consider:
1. High-Quality Investment Options
NueSynergy offers an all-ETF lineup, which is the cheapest among its peers, with an average expense ratio of just 0.05%. This low-cost structure allows you to maximize your investment returns. Additionally, as stated in Morningstar, NueSynergy’s investment offerings include no Neutral- or Negative-rated funds, and 64% of its menu was Gold-rated as of August 2024. This high-quality selection ensures that your investments are in reliable and well-performing funds.
2. No Minimum Balance Requirements
NueSynergy does not require a minimum balance to start investing, making it accessible for all account holders. This flexibility allows you to begin investing as soon as you open your HSA, without having to wait until you accumulate a certain balance.
Strategies for Maximizing Investments with NueSynergy
To make the most of your HSA as an investment tool with NueSynergy, consider the following strategies:
1. Maximize Contributions
For 2025, the maximum HSA contribution is $4,300 for individuals and $8,550 for families. If you’re 55 or older, you can contribute an additional $1,000. Maximize your contributions each year to take full advantage of the tax benefits and growth potential.
2. Invest Aggressively Early On
If you’re young and healthy, consider investing aggressively in your HSA. With a longer time horizon, you can afford to take on more risk, which can lead to higher returns.
3. Use Other Funds for Medical Expenses
To allow your HSA investments to grow, try to cover current medical expenses out-of-pocket if possible. This way, your HSA can continue to grow tax-free, providing a larger nest egg for future healthcare costs or retirement.
NueSynergy’s Health Savings Accounts offer a unique opportunity to combine healthcare savings with robust investment potential. By understanding the tax advantages and investment opportunities NueSynergy provides, you can maximize your financial health and secure a more prosperous future.
by admin | Oct 24, 2024 | Blog
The IRS announced the 2025 contribution limits for all Flexible Spending Account (FSA) plans. Below is an overview of the limit increases across all the types of FSAs except for Dependent Care FSAs, which remain the same at $5,000 per year.
Health Flexible Spending Account
The Health FSA, which provides employees the ability to set aside money on a pre-tax basis to pay for eligible medical, dental, and vision expenses will have an increase to its contribution maximum from $3,200 to $3,300 for 2025. The new contribution limit will also apply to the Limited Purpose FSA which reimburses eligible dental and vision expenses. Limited Purpose FSA limits will also increase from $3,200 to $3,300 for 2025.
Carryover Limit
The FSA Carryover limit provides employers the option to transfer a maximum amount of remaining FSA balances at a plan year’s end to carryover for use during the next plan year. This is available with Healthcare and Limited Purpose FSAs only. The carryover limits for this account will increase from $640 to $660 for 2025.
Commuter Benefits
Commuter Benefits help employees pay for certain parking, mass transit, and/or vanpooling expenses with pre-tax dollars. The contribution limits for this account will increase from $315 to $325 for 2025.
Adoption Assistance
The Adoption Assistance FSA helps employees pay eligible adoption expenses such as agency fees and court costs by contributing to the account with pre-tax money from their paycheck. The contribution limits for this account will increase from $16,810 to $17,280 for 2025.
For more information about this major change, read our latest handout.
by admin | Oct 18, 2024 | Blog
NueSynergy was honored to be recognized by Morningstar as a Top HSA Administrator in 2024. This recognition highlights NueSynergy’s commitment to offering exceptional HSA services that help individuals and families manage their healthcare expenses effectively.
Why NueSynergy Stands Out
NueSynergy has earned its place among the top HSA providers by offering a range of features that cater to the needs of its users:
- Investment Options: NueSynergy was recognized for its extensive variety of value-based investment options, with the majority consisting of gold rated Morningstar funds.
- Competitive Interest Rates: Account holders benefit from competitive interest rates on their deposits, ensuring their money grows even as they use it for medical expenses.
- User-Friendly Platform: The intuitive platform makes it easy to manage accounts, track expenses, and make informed investment decisions.
National HSA Day
Earlier this week, we celebrated National HSA Day, which recognizes the importance of Health Savings Accounts (HSAs), raising awareness about their benefits. HSAs can be used not only for immediate medical expenses but also as a strategic tool for retirement planning. By understanding and utilizing HSAs, individuals can take control of their healthcare finances and secure a healthier financial future.
As we celebrate National HSA Day, it’s the perfect time to explore the benefits of HSAs and consider why NueSynergy is a top choice for managing your healthcare savings. With its competitive interest rates and robust investment options, NueSynergy stands out as a leader in the industry. Take advantage of this day to learn more about HSAs and how they can benefit you and your family.
What is an HSA?
A Health Savings Account (HSA) is a tax-advantaged savings account designed to help individuals with high-deductible health plans (HDHPs) save for medical expenses. HSAs offer a triple tax benefit: contributions are tax-deductible, earnings grow tax-free, and withdrawals for qualified medical expenses are also tax-free. This makes HSAs a powerful tool for both current healthcare spending and long-term savings.
About NueSynergy
NueSynergy is known for industry-leading service, innovative technology, and excellence in providing full-service administration of consumer-driven and traditional account-based plans to employers of all sizes and sectors. NueSynergy offers a fully integrated suite of administration services, which include Health Savings Account (HSA), Health Reimbursement Arrangement (HRA), Flexible Spending Account (FSA), Lifestyle Savings Account (LSA), and COBRAcare+ administration as well as SpouseSaver Incentive Account, Combined Billing, Direct Billing, and Specialty Solutions. For more information, visit https://nuesynergy.com/
About Morningstar
Morningstar is a leading provider of independent investment research and insights. The company offers a wide range of products and services for individual investors, financial advisors, asset managers, and institutional investors. Morningstar provides data and research on various investment offerings, including mutual funds, ETFs, stocks, and bonds. Additionally, they offer investment management services through their subsidiaries, managing approximately $286 billion in assets as of December 31, 2023. Morningstar operates in 32 countries, empowering investor success globally.
by admin | Oct 11, 2024 | Blog
As a plan sponsor or benefit professional, finding the right information on the IRS website can be a daunting task. To help streamline your search, we’ve compiled a list of the most useful IRS webpages that provide crucial benefit-related information.
- Drop Library. IRS announcements, notices, revenue procedures, and revenue rulings usually appear in the IRS Drop Library before they are published in an IRB: https://www.irs.gov/downloads/irs-drop
- Information Letters. Information letters provide general statements of well-defined law without applying them to a specific set of facts. They are issued by the IRS National Office in response to requests for general information from taxpayers or congressional offices. Although information letters are only advisory and have no binding effect on the IRS, they can be helpful in understanding the IRS’s position on the issues that they cover: https://www.irs.gov/information-letters
- Written Determinations. This webpage provides access to private letter rulings (PLRs), technical advice memoranda (TAMs), and chief counsel advice (CCA). PLRs are rulings or determinations from the IRS Office of Chief Counsel that interpret and apply tax laws to a specific set of facts and are furnished in response to taxpayer requests. TAMs are written memoranda that the IRS Office of Chief Counsel furnishes in response to an IRS director or chief appeals officer request. CCA materials are written advice or instructions that the IRS Office of Chief Counsel prepares and issues to other IRS employees. These written determinations cannot be used or cited as precedent, but they are helpful in determining the IRS’s position, often on very specific facts: https://www.irs.gov/written-determinations
Other helpful IRS webpages include the following:
- IRS Newsroom. The latest news releases, fact sheets, and other IRS-related news items are available here: https://www.irs.gov/newsroom
- News Release and Fact Sheet Archive. This archive contains news releases and fact sheets issued from 2002 to the present: https://www.irs.gov/newsroom/news-release-and-fact-sheet-archive
- Topics in the News. Look here for information about items of current interest, such as new programs, recent guidance, or timely reminders: https://www.irs.gov/newsroom/topics-in-the-news
- Priority Guidance Plan. These documents provide information about regulations, revenue rulings, revenue procedures, notices, and other guidance that the IRS and Treasury Department expect to work on during a particular period: https://www.irs.gov/privacy-disclosure/priority-guidance-plan
- Frequently Asked Tax Questions and Answers. You’ll find FAQs regarding a broad array of tax categories here, as well as a search feature: https://www.irs.gov/faqs
- Affordable Care Act (ACA) Tax Provisions. This webpage provides information about ACA tax provisions for which the IRS has issued regulations or other guidance: https://www.irs.gov/affordable-care-act/affordable-care-act-tax-provisions
- ACA Information Center for Applicable Large Employers (ALEs). This webpage helps employers determine whether they are ALEs and provides helpful links to applicable IRS resources: https://www.irs.gov/affordable-care-act/employers/aca-information-center-for-applicable-large-employers-ales
- ACA Information Returns (AIR). This webpage provides information about electronic filing of returns and transmittals required under the ACA: https://www.irs.gov/e-file-providers/affordable-care-act-information-returns-air
- Tax Information for Retirement Plans. This is the IRS’s home page for retirement plan information, with links to recent developments and guidance, newsletters, and other retirement plan administration resources: https://www.irs.gov/retirement-plans
Keep in mind that other agency websites also provide useful and important benefits-related information. For example, the DOL’s Employee Benefits Security Administration (EBSA) website is also helpful and can be accessed at https://www.dol.gov/agencies/ebsa.
By utilizing these resources, you can efficiently navigate the IRS website and stay informed about the latest developments in employee benefits.
Source: Thomson Reuters
by admin | Sep 19, 2024 | Blog
When companies contribute to the cost of health club memberships or provide on-site fitness centers, questions often arise about whether these benefits fall under the Employee Retirement Income Security Act (ERISA). Understanding the nuances of ERISA and how it applies to health-related benefits is crucial for employers.
What is ERISA?
ERISA is a federal law that sets standards for most voluntarily established retirement and health plans in private industry to provide protection for individuals in these plans. For a benefit program to qualify as an ERISA plan, it must provide one or more of the benefits listed in the ERISA definition, such as medical, sickness, or disability benefits.
Health Club Memberships and ERISA
Generally, paying for employees’ health club memberships does not constitute an ERISA plan. Health and fitness clubs promote general good health but are typically made available without regard to sickness or disability. They do not diagnose or treat specific medical conditions, so they usually do not provide medical care or any other ERISA benefit. Therefore, a policy or program of paying for health club memberships would not be considered an ERISA plan.
On-Site Fitness Centers and ERISA
Similarly, providing an on-site fitness center for employees does not typically make the program subject to ERISA. On-site fitness centers, like health clubs, promote general wellness but do not provide medical care or benefits in the event of sickness. Thus, they do not meet the criteria for an ERISA plan.
Exceptions: Disease-Management Programs
In rare cases, health club memberships or access to on-site fitness centers may be part of a disease-management program that includes diagnostic, therapeutic, or preventive care. These programs might offer “coaching” for specific health conditions or risks. Such arrangements could be viewed as providing a medical benefit, potentially making them subject to ERISA and applicable group health plan rules. The complexity and fact-specific nature of these programs mean that legal counsel should be consulted to determine ERISA applicability.
Tax Considerations
Whether a benefit is subject to ERISA does not affect whether it produces taxable income for participants or beneficiaries. However, an employer’s payment or reimbursement of health club dues or provision of an on-site fitness center may raise tax issues, which should also be reviewed with legal counsel.
Conclusion
While health club memberships and on-site fitness centers generally do not fall under ERISA, exceptions exist, particularly when these benefits are part of a broader health management program. Employers should carefully evaluate their programs and consult with legal counsel to ensure compliance with ERISA and tax regulations.
Source: Thomson Reuters
