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November 04, 2011
Health Savings Account Benefits Available Until Dec. 1
There's still time to lower your 2011 income taxes, but you'll need a health insurance plan that's qualified to work with a Health Savings Account (HSA) by December 1. Health Savings Accounts are the only plan that gives you a tax deduction when you put the money in, tax-deferred earnings, and tax-free withdrawal to pay for qualified medical costs.
The high-deductible health insurance plans that work with an HSA are some of the least expensive forms of health insurance. Once you have an HSA health insurance plan is place, you can start your Health Savings Account with just a small deposit.
You'll be allowed to make deposits later and then reimburse yourself retroactively for health care costs back to the date you started your Health Savings Account.
You have until April 15, 2012 to make your 2011 HSA contribution. If you start an individual HSA, you can deposit up to $3,050 in your HSA and take the full amount as a deduction without itemizing deductions. For family HSA plans, you can contribute up to $6,150. Plus, at age 55, you can start to contribute an additional extra $1,000 each year.
Your HSA contributions can grow tax-free to build a retirement account or you can withdrawn funds to pay for health care for you and your family, even if family members are not on your high-deductible health plan. A comprehensive list of qualified HSA medical expenses that may be purchased with HSA funds is available here on our site.
Posted by Wiley Long at November 4, 2011 11:32 AM