Archer MSA

Exploring Archer MSA: A Comprehensive Guide to Medical Savings Accounts

Unraveling Archer MSA

Understanding the Basics

Archer MSA, named after former Congressman Bill Archer, was a tax-advantaged medical savings account designed for self-employed individuals and small business employees. While Congress ceased the creation of new Archer MSAs in 2007, existing accounts were allowed to continue.

Navigating Archer MSA Regulations

Tax Advantages and Regulations

Contributions to Archer MSAs were tax-deductible for account owners, and contributions by employers or employees were excluded from the employee’s income. These accounts required a high-deductible health plan (HDHP) and offered tax-free distributions for qualified medical expenses.

Archer MSA vs. HSA: Understanding the Differences

Comparing Archer MSA and Health Savings Account (HSA)

Both Archer MSAs and HSAs served as tax-benefited savings accounts paired with HDHPs. However, HSAs expanded upon the Archer MSA model by allowing contributions from both employers and employees, offering more flexibility and higher contribution limits.

Delving into Details

HDHP Requirements and Contribution Limits

Archer MSAs had specific HDHP deductible and contribution limits, while HSAs offered more generous contribution limits and lower minimum deductible requirements. Individuals with Archer MSAs might consider rolling over their accounts into HSAs to benefit from the more advantageous terms.