Tax season drums up feelings of dread. It might encourage procrastination. Tax day is the least anticipation, most last-minute experience for many Americans. Can I have an extension, please?
HSAs won’t solve your yearly tax-related anxiety, but they will (and can) save you money on your taxes. It’s pretty simple, let us show you how to lower your tax burden with an HSA (health savings account).
Use Your HSA as a Tax Shelter
No matter how IRS HSA guidelines were intended, the result was more broad and expansive than imagined. An HSA is the only saving account that has tax-free contributions, growth (through investments or interest) and distributions (aka spending). That means the HSA is 100% tax-free. There is nothing like it out there. No other savings vehicle, IRA and 401(k) included, that allow for this level of tax-benefits.
The HSA has been waiting to help you save more – more of your paycheck, and more for health costs. See if you are eligible.
The Incredible Result of HSA Savings
The simple, and unintended results of HSA savings are the multifaceted financial and tax value it creates.
- Dedicated Health Savings – The more you save (tax-free), the more you have for health cost when you need them. Today, tomorrow, or 20 years from now. HSAs never expire. Your money will always be there, just in case.
- Lower Health Costs – By saving pre-tax dollars, you are effectively paying less for health expenses. HSA savings is tax-free after all. It’s the most direct way to combat increasing healthcare costs.
- Retirement Savings – You might never need your HSA money for health expenses, or just decide to pay out-of-pocket for those expenses. After the age of 65, our HSA funds transforms into a full-fledged retirement account. You can use those funds for anything, like a 401k or IRA.
Saving more and giving less of your hard earned cash to Uncle Sam, feels good. It means more money for you. More money for health expenses. More tax-free money for anything you want in retirement.
If you need more help with health account decisions, check out our blog. We will make you a healthcare benefits expert in no time, without any extra work or effort on your end.
Disclaimer: the content presented in this article are for informational purposes only, and is not, and must not be considered tax, investment, legal, accounting or financial planning advice, nor a recommendation as to a specific course of action. Investors should consult all available information, including fund prospectuses, and consult with appropriate tax, investment, accounting, legal, and accounting professionals, as appropriate, before making any investment or utilizing any financial planning strategy.