(HSAs) Having an insurance plan with a high deductible has numerous benefits.
By JEAN FOLGER, last revised on October 30, 2022; reviewed by KHADIJA KHARTIT; fact checked by YARILET PEREZ If this holds true, you might be eligible to open a Health Savings Account (HSA).
When paired with a High-Deductible Health Plan (HDHP), an HSA can be used to cover medical costs until the HDHP’s deductible is met and you begin receiving healthcare coverage.
HSAs were established in 2003 by the Medicare Prescription Drug, Improvement, and Modernization Act. These savings accounts are increasingly being used by customers who want to control their healthcare costs. Additionally, they can be used to save tax-free money.
Important Learnings: With a HSA, you can save cash before charges to pay for medical care expenses that your protection doesn’t cover.
Assuming that you have a wellbeing plan with a high deductible that qualifies, you can open a HSA.
Individual contributions are limited to $3,650 for the 2022 tax year, while family contributions are limited to $7,300.
In 2023, individuals and families can expect to receive maximum sums of $3,850 and $7,750, respectively.
If you are 55 or older, you can contribute an additional $1,000 as a catch-up contribution.
For five HSAs, there is no use-it-or-lose policy. Toward the year’s end, the arrangement can turn over any leftover assets endlessly.
