Are HSA account contributions tax deductible? Or only the amounts spent out of HSA accounts for medical expenses?
Answers | 1
Yes, contributions to a Health Savings Account (HSA) are tax deductible in the year the contribution is made. Keep in mind that you must first be covered by an eligible health insurance plan - check with your health insurance provider. The annual contribution limit to a HSA is $3,300 for an individual and $6,550 for a family. If you are 55 years old or older you can add an additional $1,000 to either of these limits. You employer may make a contribution - check with your benefits department. You can also make a one-time transfer from an IRA to an HSA account - the transfer is tax-free and a great way of getting money out of an IRA without paying any taxes. HSAs are a great tool - contributions are tax deductible and withdrawals are tax-free when used for health care. Good luck!