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A Tax-Wise Strategy for Individuals and Businesses for Health Savings Accounts

ARTICLE | November 26, 2024

Authored by Vasquez + Company


Health Savings Accounts (HSAs) offer a smart way to manage rising medical expenses. This article explains the basics of HSAs, including contribution limits for 2025, tax benefits, and their use for both individuals and businesses. The article also highlights the advantages HSAs offer over other savings plans, such as flexibility in contribution and withdrawals, tax-free growth, and the ability to carry over unused funds year after year.

Key Points:

  • Contribution Limits for 2025: Married couples can contribute up to $8,550; individuals up to $4,300.
  • Tax Benefits: Contributions are tax-free, and funds grow tax-free, just like an IRA.
  • Employer Contributions: Employers can contribute to employees' HSAs, helping reduce overall health insurance costs.
  • Flexibility & Portability: Funds can roll over each year, and accounts are portable if you change jobs.
  • HSA vs. FSAs: HSAs allow you to carry over unused funds without the "use it or lose it" restriction of FSAs.

For more details on how HSAs can benefit you and your business, read the full article here.

 

Our firm provides the information for general guidance only, and does not constitute the provision of legal advice, tax advice, accounting services, investment advice, or professional consulting of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision or taking any action, you should consult a professional adviser who has been provided with all pertinent facts relevant to your particular situation. This article is not intended to be used, and cannot be used by any taxpayer, for the purpose of avoiding accuracy-related penalties that may be imposed on the taxpayer. The information is provided “as is,” with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.

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