5. What if money is left over in my account at year-end?

Unlike with a flexible spending account (FSA), funds in an HSA roll over and accumulate year to year if not spent. Any money in your account will be added to your next year's deposits to pay for future medical care.

If you ever decide to stop contributing to your HSA, any money left in it will still be available to be spent on qualified medical expenses.

6. Who qualifies for an HSA?

Your family or you are eligible if:

• You have no other health care coverage except for certain exceptions, such as plans limited to dental and vision care.

• You're not enrolled in Medicare.

• You're not claimed as a dependent on someone else's tax return.

7. How can I open an HSA?

You may sign up through banks, credit unions, insurance companies and other approved companies. Employers may also set up HSAs for employees.

8. How can I tell whether an HSA is right for me?

This depends mainly on your taxable income and your current health care expenses. If both are high, you may be able to use an HSA to make many — even most — of your health care expenses tax-deductible.

9. Where can I get more information?

Read this IRS publication for details. The rules and provisions of HSAs are too complex to cover in full here.

Also of interest: Save for medical costs with an HSA. >>

William J. Lynott is an author and freelance writer who specializes in business and financial issues.