It always pays to plan ahead! And in terms of a health savings account (HSA), your planning actually does double-duty. You’re not only building a stockpile of savings for possible healthcare expenses down the road. You’re also working to lower your tax responsibility too!
New HSA Limits for the 2022 Tax Year
Individuals and families will be able to contribute more money into their health savings accounts next year. For individuals, there’s a $50 limit increase. Families will be able to add an extra $100 to their HSA from last year’s limits. These numbers may not sound especially impressive, but every little bit counts. It’s always nice to have the option to put more cash into a savings account that offers multiple benefits.
The shifts for 2022 bring the maximum annual contribution to $3,650 for an individual’s HSA and $7,300 for families. There’s also the option for people ages 55 and up to contribute an additional $1,000 above those standard limits.
But just remember, though, that the HSA tax advantage is only available to those enrolled in a high-deductible health plan (HDHP). As the name suggests, an HDHP comes with higher demands for your deductible contributions compared to other health insurance plans. The minimum deductible requirements are $1,400 for personal coverage and $2,800 for a family plan. So if that’s how your policy works, you might be eligible for opening an HSA!
Key Benefits of Starting Your HSA
Not everyone has a situation where they qualify for opening an HSA. But if you do have the option, then you should definitely consider the benefits. The main motivator is that you’ll be able to pay for your medical care, including dental and vision, with pre-tax money. Another key reason to open an HSA is that you’ll be able to have a nice nest egg for the future. That means more peace of mind. Most medical expenses are unexpected. Planning ahead and saving for those worst-case scenarios is a great way to keep your finances strong for the long term.
Tax Planning for 2022—and Beyond!
If you’re ready to make a game plan for your 2022 HSA contributions, you can always give our team a call. We’ll be able to help you run the numbers and find solutions for your annual and monthly budget.
Finding ways to utilize tax-free money is what a tax planning session is all about, and adding an HSA to the mix can be a big help. So let’s make sure you’re on-track. NSO & Company works with clients all throughout the year for their tax planning needs. We know there can be a lot of stress surrounding your finances and how to keep your tax responsibility as low and reasonable as possible. That’s why we’re here to help.
What’s more, we truly care about building relationships with our clients. We think of ourselves as more hands-on than other accounting firms. As a result, we’ve continued to have clients stay loyal to us and recommend us to their friends and family over the years. We’re always honored to hear from new clients—so please don’t hesitate to contact us to learn more about your options for either this year’s or last year’s taxes!