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Small Business Tax Deduction Strategies: 10 tips on Section 179, home office write-offs for the self-employed, tax deductions for vehicles, rental depreciation, real estate capital gains and more!
Small Business Tax Deduction Strategies: 10 tips on Section 179, home office write-offs for the self-employed, tax deductions for vehicles, rental depreciation, real estate capital gains and more!
2 Responses to "Does Medicare affect health savings accounts?"
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- Does Medicare affect health savings accounts?
Does Medicare affect health savings accounts?
- By Small Business Tax Strategies
- 10/18/2009 - 5:00pm
- Small Business Tax
Small Business Tax Strategies
Smart small business owners save thousands of dollars per year on their personal and business taxes by taking advantage of the legal loopholes that the government creates for their unique tax situation. Small Business Tax Strategies cuts through tedious tax code to reveal the bonanza of completely legal opportunities to grow personal wealth and secure an enjoyable retirement. Learn more about Small Business Tax Strategies and the two free reports you’ll get when you subscribe...
Q. I have an HSA, but I’m turning age 65 in November. Can I still contribute to the HSA if I enroll in Medicare Part A? A.G., Waterbury, Conn.
A. No. A Health Savings Account (HSA) enables someone with a high-deductible health insurance plan to set aside funds (within certain annual limits) on a pretax basis. However, if you sign up for any part of Medicare (Part A generally covers hospital expenses), you’re no longer eligible to contribute to the HSA.
Tip: You can postpone participation in Medicare Part A if you also defer receipt of Social Security benefits.
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2 Responses to "Does Medicare affect health savings accounts?"
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said this on 19 Oct 2009 5:03:19 PM EST
You cannot continue to contribute into an HSA once you have Medicare. You would also need to prorate your 2009 HSA contributions so you do not find yourself in an overcontribution situation due to the IRA "testing period" and recapture rules. If you have single coverage and are over 55 then your max would be 1/12th of $4,000 per month of HSA eligibility in 2009. $3,000 max single contribution plus $1,000 catch up. If you have family HSA compatible coverage then your max would be 1/2th of $6,950 for each month of eligibility. $5,950 family max plus $1,000 catch up. If your spouse is also 55+ and not yet on medicare and meets all HSA eligibility rules she may also set up her own HSA account inorder to make a catch up contribution.
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said this on 09 Nov 2009 2:48:21 PM EST
Our employee was signed up for Medicare Part A by Social Security earlier this year even though he told them he had an HSA and wanted to keep it (He has a High deductible plan which covers him and an under-65 spouse) He has been trying to "disenroll" from Part A for several months now, and Social Security recently told him Part A coverage is mandatory. BTW, they also told him they had no idea what an HSA was. Any thoughts on his situation? Thanks.
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