Are You HSA eligible? If so, here’s how to take advantage of it during this time of year. Open enrollment just passed, but if you did not consider contributing to your HSA, now is a great time to do so given that we’re in the beginning of the year. Many individuals have questions about what benefits they are eligible for, and what those benefits truly mean. Retirement savings and medical coverage are typically a large part of your workplace benefits, which is why it’s so important to take advantage of what’s available to you, such as an HSA.
So, what are HSA’s? An HSA is a tax-advantaged health savings account that allows you to save money to use to pay medical and health care expenses. If you get your insurance coverage through high-deductible health plans, you can qualify for an HSA. Your contributions within the account will grow on a tax-free basis, and any untouched dollars can be rolled over year to year. By using untaxed dollars in a Health Savings Account to pay for deductibles, copayments, coinsurance, and some other expenses, you may be able to lower your overall health care costs.
Due to inflation, the IRS increased the contribution limits for HSAs in 2023. So, employees and employers can now contribute a total of up to $3,850 for individual coverage, up from $3650 in 2022, and up to $7750 for family coverage, up from $7,300 in 2022. The HSA catch-up contribution if you are 55 years or older remains at $1000, the same as 2022. These adjustments are quite large, so be sure to take advantage if you are eligible to do so!
Be sure to contribute by the end-of-the-year December 31st deadline, so that you can make the most of your yearly contribution. Keep in mind that HSAs are just one of the many benefits that you can take advantage of. Check out our open-enrollment blog to see what else you may have been eligible for and our retirement contribution limits blog to see the increases in retirement contribution limits ! For other end of the year tips, check out our financial checklist blog here. If you have any questions about funding your various accounts, email us at firstname.lastname@example.org or schedule a complimentary 30-minute consultation here.