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HSA Tax Deduction Question
Posted on 2/5/24 at 9:32 am
Posted on 2/5/24 at 9:32 am
My wife has a minor surgery scheduled for next week. She has a $5000 deductible and does not have a HSA.
Can she open a HSA account this week and deposit $5150 ($4150 plus $1000 over 55 years old catch-contribution 2024 Maximum Contribution)
Does the HSA funds have to be in the account for a certain amount of time to be tax deductible for 2024? The HSA funds will probably be in the account for 30-60 days.
Can she open a HSA account this week and deposit $5150 ($4150 plus $1000 over 55 years old catch-contribution 2024 Maximum Contribution)
Does the HSA funds have to be in the account for a certain amount of time to be tax deductible for 2024? The HSA funds will probably be in the account for 30-60 days.
3
Posted on 2/5/24 at 9:59 am to weadjust
So she has a high deductible health plan that is HSA eligible but she has not opened the HSA yet? Then yes, she can do pretty much what you stated.
If y’all are on the same plan (family coverage) then she can contribute up to $9300.
There is no seasoning of funds required.
If y’all are on the same plan (family coverage) then she can contribute up to $9300.
There is no seasoning of funds required.
Posted on 2/5/24 at 10:04 am to weadjust
Small thing most poeple dont know about.
If you are married and your spouse is on a different plan, say 1 is high deductible with an HSA and the other is low deductible without an HSA...the person with the HSA can pay for things for the person without the HSA due to being married.
My wife and I did this for years recently. At new jobs now and mine has an HSA, hers is not offered with one (she could open one up outside of her work though since it is high deductible) but the baby is on my plan so I can put $8,300 still into mine and just pay for any of our medical expenses which is more than enough for us.
But last year she was on a low deductible plan ($250) and I was on an HSA high deductible plan and when the baby was born I just ran everything through the HSA reimbursement process (After paying on C.C. to get miles) even though no HSA is in her name at all, still works due to us being married.
If you are married and your spouse is on a different plan, say 1 is high deductible with an HSA and the other is low deductible without an HSA...the person with the HSA can pay for things for the person without the HSA due to being married.
My wife and I did this for years recently. At new jobs now and mine has an HSA, hers is not offered with one (she could open one up outside of her work though since it is high deductible) but the baby is on my plan so I can put $8,300 still into mine and just pay for any of our medical expenses which is more than enough for us.
But last year she was on a low deductible plan ($250) and I was on an HSA high deductible plan and when the baby was born I just ran everything through the HSA reimbursement process (After paying on C.C. to get miles) even though no HSA is in her name at all, still works due to us being married.
This post was edited on 2/5/24 at 10:10 am
Posted on 2/5/24 at 10:12 am to weadjust
You should be fine, but if possible, you should avoid taking money out of an HSA until retirement. It’s the greatest tax deferral growth account there is.
Posted on 2/5/24 at 10:22 am to slackster
As stated above, if you can afford to pay out of pocket plus fund HSA keep receipts and allow the HSA to compound. You can use the receipts to take the withdrawal years later. If you do this make sure it is invested for long term growth.
You could be better off making payroll deductions rather than manual contributions because payroll goes in pre tax avoiding the 7.65% FICA tax.
ETA: you should still be able to make manual contributions for 2023 and fund 2024 w payroll
You could be better off making payroll deductions rather than manual contributions because payroll goes in pre tax avoiding the 7.65% FICA tax.
ETA: you should still be able to make manual contributions for 2023 and fund 2024 w payroll
This post was edited on 2/5/24 at 10:25 am
Posted on 2/5/24 at 10:44 am to TorchtheFlyingTiger
After reading the replies & looking into it a little more. The wifes health ins has a max out of pocket of $8550 & google says to be eligible for a HSA the 2024 max out of pocket can not exceed $8050.
I have a low deductible plan so not eligible for family HSA
I have a low deductible plan so not eligible for family HSA
Posted on 2/5/24 at 10:55 am to weadjust
quote:
The wifes health ins has a max out of pocket of $8550 & google says to be eligible for a HSA the 2024 max out of pocket can not exceed $8050.
Is her plan only for her? Is it labeled as an HDHP plan?
Posted on 2/5/24 at 11:04 am to notsince98
She has a plan for her only through her employer. I am self employed & have a different plan. I can find out if her plan is labeled as a HDHP plan.
Posted on 2/5/24 at 11:38 am to slackster
quote:
You should be fine, but if possible, you should avoid taking money out of an HSA until retirement. It’s the greatest tax deferral growth account there is.
This. Mine is another retirement account.
Have about 53 in mine.
Posted on 2/5/24 at 11:50 am to notsince98
Her employer health care plan is not labeled as a HDHP
Looks like her $8550 max out of pocket is going to spoil my plan
Looks like her $8550 max out of pocket is going to spoil my plan
Posted on 2/5/24 at 11:58 am to PhiTiger1764
No to hijack but…my wife has a HDHP eligible plan but the employer provides $250 in the form of an FSA. My understanding is that you cannot have an HSA and FSA at the same time.
Can I direct her employer not to provide the FSA benefit so she can start an HSA? We also have a child on her account. We would like to fund this and allow it to grow and pay health care out of pocket.
The employer is not very helpful in all of this and doesn’t understand why we don’t want the FSA benefit.
Can I direct her employer not to provide the FSA benefit so she can start an HSA? We also have a child on her account. We would like to fund this and allow it to grow and pay health care out of pocket.
The employer is not very helpful in all of this and doesn’t understand why we don’t want the FSA benefit.
Posted on 2/5/24 at 12:15 pm to lighter345
I highly doubt the employer will stop for a single employee, but if that’s the only thing holding you back, it’s worth continued pressure.
Posted on 2/5/24 at 1:43 pm to lighter345
Check if the FSA is a limited purpose or dependent care FSA. You can have those while also having an HSA, just not a healthcare FSA.
It would be kind of odd for the employer to contribute to a healthcare FSA, negating the much larger benefits of an HSA for their employees.
It would be kind of odd for the employer to contribute to a healthcare FSA, negating the much larger benefits of an HSA for their employees.
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