Note: This should not be taken as tax or legal advice.

Health Savings Accounts (HSAs) combine the benefits of both traditional and Roth 401(k)s and IRAs for medical expenses.

Taxpayers receive a 100% income tax deduction on annual contributions, they may withdraw HSA funds tax-free to reimburse themselves for qualified medical expenses, and they may defer taking such reimbursements indefinitely without penalties.

HSAs are unique - “IRAs on Steroids” - with triple tax advantages:

1. Tax-deductible contributions, 
2. Tax-free accumulation of interest and dividends tax-free, and 
3. Tax-free distributions for qualified medical expenses.