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New Member

HSA Benefit

Any benefit to funding an HSA in 2018?  Will it reduce AGI?

2 Replies
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Level 14

HSA Benefit

there is benefit as long as you qualify 

 

for example, if you do not have a high deductible medical insurance plan, you are not eligible for an HSA

if you are on medicare, you are not eligible for an HSA

the limit is based on whether the high dedictible plan is covering only you or your family.

 

check IRS website for the specific exclusions

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Level 4

HSA Benefit

Health Savings Accounts are an amazing way to save on taxes. Contributions by you are not taxable, contributions by your employer are not included in your wages and still deductible by your employer. As long as you only pay for medical expenses from these accounts the growth of the account is tax free.

If you are not contributing the max each year and you have medical expenses above what you have in your account, put more money into the HSA and then pay for medical expenses.

I have also seen many situations where your AGI just barely passes limits for certain deductions and credits. Making this contribution decreases your AGI, and allows you to take other deductions. You also have until April 15th of the next year to make these contributions for the current year.