VIEWpoint Issue 1 | 2022
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Weathering the Storm of Rising Inflation
With the year-end quickly approaching, many U.S. taxpayers are beginning to explore the most optimal tax breaks and deductions to reduce their overall tax liability. One favorable tax deduction U.S. taxpayers should consider is a Health Savings Account (HSA), as they allow individuals to set money aside on a pre-tax basis to pay for qualified medical expenses.
Employers often offer High Deductible Health Plans (HDHP) as a healthcare option, so individuals should check with their employer if unsure. If an employer does offer an HSA, they may opt to fund it as well. If an employer does not offer an HSA, individuals can set up their own plan through some banks or other financial institutions, where they can then make their own contributions. In either event, individuals may only contribute to an HSA if they participate in a HDHP.
Although HSA contributions are pre-tax, there are specific contribution limits. For 2020, individuals with an HDHP can contribute up to $3,550 for self-only coverage and up to $7,100 for family coverage into an HSA. Additional HSA benefits include:
Whether covered by an individual’s employer or not, HSAs have proven to be a great tax benefit for U.S. taxpayers. Plus, the deduction isn’t limited to those who itemize. To explore additional tax benefits relevant to you or your business, contact Doeren Mayhew’s tax advisors today.
This publication is distributed for informational purposes only, with the understanding that Doeren Mayhew is not rendering legal, accounting, or other professional opinions on specific facts for matters, and, accordingly, assumes no liability whatsoever in connection with its use. Should the reader have any questions regarding any of the news articles, it is recommended that a Doeren Mayhew representative be contacted.
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