Posts Tagged ‘pre-tax’

Health Savings Account Contributions for 2010

Monday, October 5th, 2009

Health Savings Account plans, high deductible health plans, have the added benefits of tax deductions. Unused balances can be carried over to following years, thus allowing you to save money tax free. Since an HSA allows you to purchase a high-deductible insurance plan with lower premiums, it an excellent way to save money on healthcare. Add to that the fact your contributions to the fund are tax free, you can enjoy considerable tax savings. Finally, since the interest is tax free and tax deferred, you can also use Health Savings Accounts to supplement retirement income.

 

For those with Health Savings Account Plans, please note the following contribution limits for 2010:
 
• For individual coverage, the maximum contribution is $3,050
• For family coverage, the maximum contribution is $6,150
• In addition to the maximum contribution amount, catch-up contributions
of $1,000 may be made by or on behalf of individuals age 55 or older and
younger than 65

 

If you have more than one HSA account, these limits are going to be applicable for all the accounts together.

What Qualifies as a Tax-Deductible Medical Expense?

Friday, May 15th, 2009

When it comes to Health Savings Account health plans, one of most common questions we hear is what is a qualified medical expense? As you know, you can use your savings account to cover expenses that are not covered by your health plan, though there are limitations as to what does and does not fall under the definition of eligible medical expense. According to the IRS Publication 502, Medical and Dental Expenses, the general purpose of the health savings account is to cover “Medical expenses are the costs of diagnosis, cure, mitigation, treatment, or prevention of disease, and the costs for treatments affecting any part or function of the body.” Such items that would fall under this category include:

Savings with a Premium Only Plan (Section 125)

Friday, May 8th, 2009

 The IRS has instituted a provision in Section 125 of their code. This provision allows for a simple change in your company’s payroll process that reduces your taxable payroll. Every premium contribution your employees make will be deducted from your overall taxable payroll amount. Here’s what you and your employees can expect with a Premium Only Plan or POP.

Employer Benefits

Lower Taxes – Every small business owner needs to take advantage of every tax break they can find. By using a POP plan, you are immediately lowering your taxes, which means that you can turn this additional revenue into more options for your business.


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