How does an HSA work?
Your HSA account works in conjunction with the high-deductible health plan offered by Alcoa as part of the Choices HSA option. All the money you and Alcoa deposit into the account up to the maximum annual contribution limit is 100 percent tax-deductible for federal income tax, FICA (Social Security and Medicare) tax, and in most states, state income tax. This makes HSA dollars tax-free. You can use these tax-free dollars to pay for your medical and prescription drug expenses, including your deductible and coinsurance amounts. In addition, you can use tax-free dollars for qualified medical expenses not covered by your medical and prescription drug plans, such as dental, vision, and alternative medicines. The funds in the account can also be used for other, non-medical expenses. Warning: If you use the money in your account for non-health care expenses, the amount is subject to ordinary income tax, plus a 10 percent penalty if you are under age 65. The 10 percent penalty does not apply i
