SACRAMENTO, Calif. - California Gov. Arnold Schwarzenegger signed into law on July 21 legislation that will allow state-licensed credit unions to offer their members health savings accounts, effective January 1, 2006. The law creates parity between California's state-chartered credit unions and federally-chartered credit unions, because the latter were already permitted to offer the accounts. "We congratulate all the credit union professionals and volunteers involved in the process of turning AB 434 into law," said Matthew Davidson, Executive Vice President of the California Credit Union League. "League members worked hard to lobby for the bill, especially during this year's Government Relations Rally. Their responses to several League `Calls to Action' resulted in hundreds of letters in support to the state Legislature and the Governor's office. It was a great team effort." Upon reviewing new state law and applicable regulations, the League's Research and Information Department will issue a new technical bulletin shortly. HSAs are congressionally authorized, tax-sheltered savings accounts similar to an Individual Retirement Account, but earmarked for medical expenses. Taxpayers can deduct contributions to HSAs from their gross income, and the interest and investment earnings generated by the account are also not taxable while in the HSA. These accounts can help employers to offer and consumers to purchase lower-premium health insurance plans that consequently carry higher deductibles.
Schwarzenegger Signs HSA Law, Creates Parity for State-Chartered CUs
Want the latest credit union news?
Sign up for our free newsletter today! All the breaking credit union news and information you need to make the right decision for your credit union delivered to your inbox. For free!
Thanks for subscribing, you will start receiving the Daily News Alert tomorrow!
- The 4 Major Designs of the $100 Bill (Slide Show)
- Anonymous May 7 Target List Includes 12 Large Credit Unions
- Theresa Portillo Sentenced to 6½ Years in Prison for Looting Feminist CU
- WesCorp’s Legacy Losses Outpace Other Corporates
- Stacie Wyss-Schoenborn Seeks Innovation One Step at a Time: Women to Watch