|Contributions to Health Savings Accounts (HSAs) will no longer be taxed by the state after a new bill was signed into law by Governor Walker.
HSAs are savings accounts owned by an individual that can be used for minor medical expenses, such as office visits, prescription and over-the-counter medications, and other preventative care. A high-deductible health insurance policy is used in conjunction with an HSA to cover major medical expenses.
HSAs are an attractive benefit to employees since they are portable and remain with an individual if they change jobs or leave the workforce. HSA contributions are currently exempt from federal taxation and Wisconsin was one of only a handful of states that had still been taxing contributions.
As passed, the Wisconsin H S A law will allow Wisconsin taxpayers to keep $49.2 million of their own money over the next two years. The law will be effective retroactive to January 1, 2011.
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