Tax Income

Maximize your HSA benefits by contributing the IRS maximum limit annually. For 2023, the limit is $3,850 for individuals and $7,750 for families. If you’re 55 or older, you can contribute an additional $1,000 as a catch-up contribution.

Many HSA providers allow you to invest your funds in mutual funds, stocks, or ETFs. Investing allows your money to grow tax-free over time, potentially increasing the account's value for future healthcare expenses.

Withdraw funds tax-free for qualified medical expenses, including doctor visits, prescriptions, and dental care. Keep receipts to validate withdrawals in case of an audit.

Save your receipts and delay reimbursing yourself to allow your HSA balance to grow over time. You can reimburse yourself years later as long as the expense qualifies.

If your employer offers HSA contributions as part of your benefits package, utilize them. Employer contributions count toward your annual maximum, reducing the amount you need to contribute personally.

After age 65, HSA funds can be used for non-medical expenses without penalties, though they will be taxed as income. Continue using the funds for medical expenses tax-free to maximize savings.

Withdrawals for non-qualified expenses before age 65 incur a 20% penalty and are subject to income tax. Plan your withdrawals carefully to avoid unnecessary penalties.

If you use both an HSA and an FSA, ensure coordination between the two accounts. Limited-purpose FSAs can cover dental and vision expenses, allowing you to preserve HSA funds.