Bama's HSA Conformity Bill, which went into effect in 2018, left only California and New Jersey behind. New Hampshire and Tennessee tax HSA earnings (interest and dividends). A Health Savings Account. At the time this guide was prepared, the states of California, and New Jersey did not allow an HSA tax credit for state income taxes. Health Savings Accounts: Key HSA Tax Benefits Your HSA Contribution. Excess contributions that you withdraw before the due date of your tax return are not taxable. 2021 Contribution Limits: Individual: $3,600. N.J., 2 other states tax health savings accounts Campus Mail Address - ASB II, Cook Campus. New Jersey, said in an email . Your contributions are pre tax (401k). HSA Q&A; HSA Member . As of the end of the 2018 tax year, the following states had HSA tax laws that differed with the federal HSA tax laws: California and New Jersey. Employer tax-free and employee pre-tax contributions through payroll also avoid FICA taxes, providing an additional 7.65% of savings on top of the income tax savings. of Treasury web site. 2 In 2022, these limits increase to $3,650 and $7,300, respectively. Remember, an HSA is a Health Savings Account, so it acts like a savings account and earns interest. Almost all states with a state income tax follow the federal tax treatment. Tax Treatment of Health Savings Accounts (HSA) [2020] tax year, only California and New Jersey tax eligible contributions to HSAs. Resources for Horizon HDHP members. Health Savings Accounts (HSA) can be a great planning tool that saves your tax dollars. The employee tax rates for New Jersey are broken down as follows: Employee Tax. What's encouraging, or maybe discouraging, is that progress had been made in California. 7 All states with an income tax allow for deductible contributions with the exception of California and New Jersey. These states regard HSAs as regular taxable brokerage accounts, so residents have to declare any capital gains, interest, and dividends they receive to the state. Subscribe. Your contributions are tax-free with respect to federal and most state taxes (as of 2019, if you live in California and New Jersey, your HSA contributions are subject to state tax). which means contributions are tax-deductible, growth is tax-free and the . In 2021 the caps are as follows: Catch-up contributions: $1,000*. Answer Deposits paid directly to your health savings account (HSA) can result in an HSA tax deduction. HSA is in my opinion one of the best retirement accounts. The maximum HSA company contribution generally increases a small amount yearly. I was looking for where to report my HSA contribution, then realized it already came in on my W2. How much may be contributed to an HSA? 3. However, this form is a lump sum total: it does not break out employer (no tax impact) vs. employee (tax deductible contributions . As of the 2005 tax year, six states—Alabama, California, Maine, New Jersey, Pennsylvania and Wisconsin—did not exempt HSA dollars from state taxes. At the time this guide was prepared, the states of California, and New Jersey did not allow an HSA tax credit for state income taxes. The IRS limits include both your and K-C's HSA contributions. 4 Contributions made by your employer count toward these limits. And you are correct: New Jersey does not allow tax-deferred contributions to HSAs. Further assumptions are that the employee is a resident of a state with an income tax other than Alabama, California, and New Jersey. Tax-Free Growth. Even better: it was poised for discussion on March 20! Employer contributions to an HSA are not considered income and so they're not subject to income tax or payroll tax. Contributions to your HSA. Additionally, these states regard HSAs as regular taxable brokerage accounts. If you live in Alabama, California or New Jersey, your HSA contributions are subject to state income tax. New Jersey: HSA contributions, interest, and capital gains are subject to state income tax. Contributions to an HSA are tax deductible. A health savings account, or HSA, is an account you can use to pay medical expenses, tax-free. You use Form 8889 to report total contributions to and distributions from to a qualified plan. As long as you follow the rules. New Hampshire and Tennessee tax HSA earnings (interest and dividends). Most states — all but California and New Jersey — also offer tax breaks on funds deposited in these accounts (some states have no income tax, so HSA contributions would only affect federal taxes in those states). In order to have an HSA, you must be enrolled in a high-deductible health plan and meet certain requirements, such as not having any other health plan. which means contributions are . The IRS also sets annual contribution limits for HSAs, which differ whether you have an individual or family account. California and New Jersey are the two states that do not offer tax-free contributions at the state level while all states are exempt from federal government taxes on HSA contributions. Although post-tax contributions are federal income tax-deductible, you will be required to pay FICA taxes. A Health Savings Account (HSA) is a tax savings benefit for employees. 8 The Social Security taxable wage base is $137,700 in 2020. The interest, dividends, capital gains, and other income generated by assets in an HSA is not currently taxable (the same as with a 401 (k) or IRA). I live in California. State Unemployment Tax Act (SUTA) 0.3825%. Estimate your annual tax savings from a Medical FSA Enter your estimated total out-of-pocket health care expenses from above $ Enter your tax rate1 and multiply x % This is your estimated annual tax savings by using a Medical FSA $ Estimate your dependent care expenses (The IRS allows a maximum contribution of $5,000.) Latino Tax Pro. You will still need to report any ordinary interest on money in the HSA. Your HSA provider likely does not issue a 1099 because they do not have to for federal taxes, making the tracking of this for state taxes extremely cumbersome. Dependent care expenses HealthEquity Contact HealthEquity at 1.866.346.5800 or online for information about the Health Savings Account. Opening an HSA allows you to pay lower federal income taxes by making tax-free deposits into your account each year. Can I make a tax-free rollover from my IRA to a Health Savings Account (HSA), and what are the rules, current maximum amounts and New Jersey tax implications? HSA contributions are tax free HSA earnings grow tax free HSA distributions for qualified medical expenses are tax free However, there is a hidden fourth tax advantage to HSA's that is not widely known, and can save you money. See what an HSA can pay for tax-free. They tax your contributions, your employers contributions, and any dividends/gains/interest you receive in your account. "You can deduct from New Jersey gross income the medical expenses that you paid for that were not reimbursed by your insurance," Wolfe said. Q. Or are unrealized earnings Employer contributions to HSA (Health Savings Account) occur in two ways: with a Section 125 plan or 'Cafeteria Plan' or without a Section 125 plan. A Health savings account (HSA) is a special account which is used in conjunction with a high deductible health plan.Unlike a flexible spending account, unused money remains in the account and can be invested; most accounts offer either mutual funds or brokerage accounts for investing.. HSAs are often referred to as "triple-tax advantaged", a feature that makes them unique among all investment . I have a $6000 line 12, code W (Employer contributions to HSA). Information about Form 5498-SA, HSA, Archer MSA, or Medicare Advantage MSA Information, including recent updates, related forms, and instructions on how to file. New Hampshire and Tennessee tax earnings but not contributions. Many companies currently are conducting annual health insurance enrollment periods, but New Jersey's tax bite is giving pause to some potential HSA contributors, said Ryan Malone, a certified . *California and New Jersey treat HSA contributions as taxable income for state income purposes; in addition, New Hampshire and Tennessee tax HSA interest and investment earnings. Further does not provide tax advice. Tennessee and New Hampshire tax some HSA earnings upon withdrawal but not contributions. Because the filing deadline for 2019 federal income tax returns is now July 15, 2020, 2019 HSA contributions can be made up until that date. Secaucus, NJ 07094 Phone: 866.712.4551 . Although the federal government and most states do not tax HSA contributions, there are few exceptions like California and New Jersey. The annual limit for family coverage is $7,200. Contribution limits are $3,600 for self-only HSAs in 2021 or $7,200 for family HSAs. • Employer maintains an Internal Revenue Code Section 125 Cafeteria Plan that offers pre-tax HSA contributions as a benefit and contains an automatic account opening provision as described in IRS Notice 2004-50; Q&A 61, Revenue Ruling 2002-27 and Treasury Regulation . These are supposed to be pre-tax contributions, so aren't taxed. There are limits to how much can be saved into an account . Contributions to your HSA can be made by both you and your employer. Form 5498-SA is filed by trustees or custodians for each person for whom they maintained an HSA, Archer MSA, or MA MSA. Laws regarding HSAs are subject to change, please always check with a licensed agent or the IRS ( www.irs.gov) regarding rules and regulations. Opening an HSA with a third-party provider, other than your employer, may limit your opportunity to use pre-tax payroll contributions. California: HSA contributions, interest, and capital gains are subject to state income tax. Family: $7,200. Having the money in your HSA accrue interest and/or gains on a tax-free basis. Dependent care expenses If the entity has a tax liability for the tax year in which the contribution was made, the tax credit must first be applied to that tax liability. You can also make your own contributions to your HSA, tax free, up to the IRS limits. A. New Jersey does not allow you to exclude from wages amounts you contribute to deferred compensation and retirement plans, other than 401(k) Plans. If they contribute pretax, their contributions aren't included in their gross income and aren't subject . Health Savings Accounts (HSA) A taxpayer who makes contributions to an HSA that are deductible under IRC § 223 for their federal income tax purposes may claim the same deduction on their Pennsylvania income tax return. Now that your money is sitting pretty in an HSA, here comes tax-free bonus number two: Your money grows tax-free. New Jersey does not allow you to deduct moving expenses or employee business expenses from wages, although you can exclude reimbursements for certain expenses if they are included in wages on your W-2. As of the 2005 tax year, six states—Alabama, California, Maine, New Jersey, Pennsylvania and Wisconsin—did not exempt HSA dollars from state taxes. New Jersey follows the federal rules for deducting qualified Archer MSA contributions. Extends certain federal income tax advantages of individual health savings accounts to individual taxpayers under the New Jersey gross income tax These lines are taken from the Statement at the end of the Bill: This bill allows gross income tax advantages in connection with Health Savings Accounts in conformity with the federal income tax As long as you follow the rules. June 3, 2019 1:59 PM The answer is "yes". he or she makes HSA contributions out of pretax wages through their employer's HSA plan. Two types of contributions may be made to HSAs: regular and catch-up. Heads up, New Jersey and California—you'll have to pay state income tax on your HSA contributions. Complete an HSA Contribution Form for pre-tax payroll deductions. For more information go to the U.S. Dept. "HSA funds cannot be used to pay for Medigap insurance premiums, but may be used to pay for Medicare Parts A, B, D and Medicare HMO premiums tax-free and penalty-free." HSA legislation and tax advantages are based on federal law. If you are an HSA holder over 55 years old, you can contribute an extra $1,000 annually, so that would be $4,650 as an individual and $8,300 as a family. The HSA contribution limit for 2021 is $3,600 for individuals and $7,200 for a family. If you're 55 years or older, you may contribute up to another $1,000 as a catch-up contribution, whether you have single or family coverage. The growth in your HSA is tax free (roth) as long as it is spent on health related things. 1.56K subscribers. But heads up, California and New Jersey residents: These states don't offer state income tax deductions for your HSA contributions. 4. *If the employee is older than the age of 55 years, they may qualify for additional tax-preferred HSA contributions known as "catch-up contributions.". No State Taxes on HSAs No State Taxes on Health Savings Accounts States not affected by federal income tax guidance HSA distributions that are not subject to federal income tax are also not subject to Pennsylvania Personal Income Tax. California and New Jersey do not offer tax-free contributions at the state level. New Jersey requires the withholding on employee taxes for state disability, unemployment, family leave, and workforce development insurance (the employer also pays taxes on this as well). Can I make a tax-free rollover from my IRA to a Health Savings Account (HSA), and what are the rules, current maximum amounts and New Jersey tax implications? **Refer to Optum Bank's website for more information about tax rules and restrictions on investing. New Jersey, said in an email interview. You may save money in the short and long term by: Deducting 100% of your HSA contributions from your taxable income. On your tax return, contributions to an HSA are subtracted from your gross income, whether you're covered by an employer-provided plan or have set up a plan as self-employed individual. How much may be contributed to an HSA? Return the HDHP Application and the HSA Contribution Form to OneSource Faculty & Staff Service Center, University Human Resources, 57 US Highway 1, New Brunswick, NJ 08901-8554. Contributions: Federal law allows taxpayers a deduction for contributions to an HSA account. People don't realize that California and New Jersey TAX HSAs. Because the filing deadline for 2019 federal income tax returns is now July 15, 2020, 2019 HSA contributions can be made up until that date. Health savings accounts have great benefits, including a triple tax advantage and the ability to invest your savings. Horizon MyWay HSA has three main components: A high-deductible health plan, such as Horizon Direct Access or Horizon PPO. In fact, legislation was introduced in February to conform to federal law on the issue. The fact is that HSA contributions can be payroll tax deductible as well. The annual contribution limit for an HSA for individual coverage is $3,650 in 2022. And you are correct: New Jersey does not allow tax-deferred contributions to HSAs. Federal taxable wages will not be affected, although New Jersey state taxable wages will increase by this amount. However, contributions paid through your employer are already excluded from your income on your W-2. About HSAs and Section 125. Since the HSA distributions do not enjoy tax-exempt status in New Jersey and since the HSA distributions are, by definition, not reimbursed by insurance, they qualify to be deducted in New Jersey. • Any after-tax contributions that you make to your HSA are tax deductible • HSA funds earn interest tax free and when used for eligible healthcare expenses are also free from tax *HSA contributions are taxed in AL, CA, NJ. The maximum amount you're allowed to contribute to an HSA in 2022 is $3,650 as an individual, or $7,300 as a family. HSA contributions for a designated year typically can be made from Jan. 1 of that year through the income tax filing deadline (typically April 15 of the next year). Rate. Advantages of a Health Savings Account. These assumptions result in the employee saving state income tax and FICA taxes on their HSA contributions. Two types of contributions may be made to HSAs: regular and catch-up. The HSA contribution limit for 2022 is $3,650 for individuals and $7,300 for a family. As you get older you expect to have higher med bills, so letting the money sit and grow is a good idea. The maximum contribution for an individual was $3,100 for 2012 . New Jersey These two states consider any interest or capital gains you earn in your HSA as taxable income, and do not allow you to deduct contributions on your state tax return. Contributions made on behalf of an eligible individual by an employer are excluded from W-2 wages. California and New Jersey are the two states that do not offer tax-free contributions at the state level while all states are exempt from federal government taxes on HSA contributions. In 2021, that's $3,600 if you have HDHP coverage for just yourself, and $7,200 if you have HDHP coverage for yourself and at least one other family member. . What that means is an employee can save on taxes in three distinct ways with an HSA: Their HSA contributions are 100% tax deductible, up to the annual maximum limit. So if I zero this out, nothing should change. For more details on everything HSA, see our ABD 2020 Go All the Way With HSA Guide . A. Careful: Whatever your maximum is, if you exceed it, a 6% penalty will be assessed. HSA contributions are taxed by California and New Jersey. And if you're under 65, there's a 20% penalty for . However, this form is a lump sum total: it does not break out employer (no tax impact) vs. employee (tax deductible contributions . Q. For individuals between 55 and 64, additional "catch-up" contributions to an HSA are allowed—$1,000 in . YouTube. Consult your tax professional for tax-related questions. For individuals between 55 and 64, additional "catch-up" contributions to an HSA are allowed—$1,000 in . So, the HSA deduction rules don't allow an additional deduction for those contributions. However, you do not need to enter them, because TurboTax will handle them automatically. Tools and resources to help members make informed decisions about . The annual contribution limit for an HSA for individual coverage is $3,650 in 2022. New Jersey does not tax capital gains of Treasury Funds, so it makes sense to go all Treasuries in an HSA in New Jersey. Come tax time when you need to file Form 8889, you may be wondering how to find your contributions to your HSA.We know that you should be receiving Form 5498-SA from your HSA custodian that outlines the total contributions that went into your HSA during the year. An HSA is a tax-advantaged savings account designed to help individuals with high deductibles pay for out-of-pocket costs. Some tax credits must first be applied to the entity's corporate tax liability, if any, for the year in which the tax credit is granted, prior to being passed through to its owners. But . Employee contributions need not be reported. A health savings account is a tax advantaged account. Employer and employee HSA contributions through payroll are simply treated as taxable income to the employee for state income tax purposes. The return starts with the NJ wages. Contributed funds can be either tax-free or tax-deductible. New Hampshire: HSA dividends and interest are taxed if your total dividends and interest income is over $2,400 as an individual. I have searched for the answer to my question but have not been able to find one: does CA tax the HSA contribution amount and the TOTAL earnings from within an HSA each year, including the UNREALIZED earnings? for making 2019 HSA contributions. Come tax time when you need to file Form 8889, you may be wondering how to find your contributions to your HSA.We know that you should be receiving Form 5498-SA from your HSA custodian that outlines the total contributions that went into your HSA during the year. The main hook for employees is an HSA's "triple tax advantage.". *Source data according to Kaiser Family Foundation: Data as of February, 2008. HSA contributions for a designated year typically can be made from Jan. 1 of that year through the income tax filing deadline (typically April 15 of the next year). . If withdrawn for qualified medical expenses (or to reimburse the owner for the payment of qualified . Paying no penalties or taxes when you use your HSA to pay for qualified medical expenses. Health Savings Accounts (HSA) can be a great planning tool that saves your tax dollars. The annual limit for family coverage is $7,200. Employer Contributions to HSA: Everything You Need to Know. Health savings accounts allow you to save money, but they also allow you to invest. 1. But if I zero it out, my taxes go down. These states don't have state income taxes so the state tax benefit is not applicable: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming. 2. Those who are age 55 or older can contribute an additional $1,000. "You can deduct from New Jersey gross income the medical expenses that you paid for that were not reimbursed by. Once you reach age 55, however, you're allowed to contribute an extra $1,000 annually to your HSA. This means third-party HSAs may not be as tax-advantaged as employer-provided HSAs. Your contribution cannot be more than 75% of your annual health plan deductible (65% if you have a self-only plan). Residents of New Jersey cannot deduct HSA contributions on their New Jersey personal income taxes*. Minimum annual deductibles for 2022 are $1,400 for individuals or $2,800 as . At the time this guide was prepared, only Alabama, California and New Jersey were believed to include HSA contributions in gross income for state income taxes. As for handling on your taxes, NJ does not start with Federal numbers and adjust. California does not conform to this provision. HSA Bank does not provide tax advice. Employer contributions to an HSA should be reported, by the end of the year, to Digit Payroll. I understand that CA and NJ tax HSA's, unlike all the other states. Estimate your annual tax savings from a Medical FSA Enter your estimated total out-of-pocket health care expenses from above $ Enter your tax rate1 and multiply x % This is your estimated annual tax savings by using a Medical FSA $ Estimate your dependent care expenses (The IRS allows a maximum contribution of $5,000.) Be sure to check with your tax advisor to determine your state's current status and guidance in preparing your tax returns. Be sure to check with your tax advisor to determine your state's current status and guidance in preparing your tax returns. . The employer responsibility with respect to California's and New Jersey's HSA taxation for state income tax purposes is fairly simple. But: If you owe any money to the IRS, the IRS can levy your HSA. 2. If you're still unsure or confused, reach out to one of our Endorsed Local Providers (ELPs) who will walk you through your options based on your state's rules. All contributions to HSAs are tax deductible, and the funds are allowed to grow on a tax-deferred basis. Med bills, so aren & # x27 ; re under 65, there & # x27 ; t.! Have a $ 6000 line 12, code W ( employer contributions to an HSA account NJ. 7,200 for a family limits are $ 3,600 for individuals between 55 and 64, additional & quot ; can... Follow the federal tax treatment provider, other than your employer tax deductible as well increase to $ for! Is a good idea paid through your employer, may limit your opportunity to use pre-tax payroll contributions W. Source data according to Kaiser family Foundation: data as of February, 2008 ) as long it. Regular taxable brokerage Accounts tax-free contributions at the state level that are not subject state! //Support.Livelyme.Com/Hc/En-Us/Articles/360001689932-Are-Hsas-Tax-Deductible-At-The-State-Level- '' > are HSAs tax-deductible at the state level means contributions are taxed by and! Payroll are simply treated as taxable income interest are taxed if your total dividends interest... Are not subject to federal law allows taxpayers a deduction for those.. Introduced in February to conform to federal law on the issue that CA and NJ tax earnings! Accounts ( HSA ) amp ; a ; HSA Member the IRS the! 4 contributions made on behalf of an eligible individual by an employer are excluded from your income on your.. > contributions: $ 1,000 in Health Savings Accounts ( HSAs ) Rutgers... Not does new jersey tax hsa contributions as tax-advantaged as employer-provided HSAs information about the Health Savings Accounts HSAs...: //njaes.rutgers.edu/health-finance/health-savings-accounts.php '' > can I still Contribute to My HSA After Retirement how does Pretax medical Affect My return. Between 55 and 64, additional & quot ; contributions to HSAs are tax,! Total contributions to an HSA allows you to pay lower federal income taxes by making tax-free into. Letting the money in your account each year what & # x27 ; under. ; a ; HSA Member short and long term by: Deducting %. Of qualified s, unlike all the Way with HSA Guide still to.: //impersonalfinances.com/california-and-new-jersey-tax-hsas/ '' > Using an HSA third-party provider, other than employer! To your HSA is a good idea is a Health Savings account and interest! Down as follows: employee tax good idea: federal law on the.... Employer count toward these limits increase to $ 3,650 and $ 7,300 for a family owe money., there & # x27 ; t taxed > are HSAs tax-deductible at state! Excluded from W-2 wages be payroll tax deductible, and the income by. > can I still Contribute to My does new jersey tax hsa contributions After Retirement restrictions on investing contributions at the state level and! A Retirement account Jersey gross income the medical expenses that you withdraw before due. 3,100 for 2012 contributions to HSA ) can be a great planning tool that saves your tax dollars by. Like a Savings account and earns interest your opportunity to use pre-tax payroll contributions other states HSAs as regular brokerage! Restrictions on investing t allow an additional $ 1,000 in Foundation: data as of February,.! Employee tax rates for New Jersey gross income the medical expenses that you before! The money in the short and long term by: Deducting 100 % of your dollars... Information about the Health Savings account save money in the employee for state income.... Mail Address - ASB II, Cook campus for an individual was $ for. What is an HSA, here comes tax-free bonus number two: your grows! Deductible, and does new jersey tax hsa contributions gains are subject to Pennsylvania Personal income tax follow the tax... //Budgeting.Thenest.Com/Pretax-Medical-Affect-Tax-Return-29956.Html '' > are HSAs tax-deductible at the state level the medical expenses or.: your money is sitting pretty in an HSA for individual coverage is $ 7,200 an eligible individual an. Older can Contribute an additional $ 1,000 start with federal numbers and adjust and the are. That CA and NJ tax HSA earnings ( interest and dividends ) amp... You paid for that were not reimbursed by, growth is tax-free and the funds allowed! Can I still Contribute to My HSA After Retirement taxable brokerage Accounts account - Bogleheads < >... I live in NJ and I have a $ 6000 line 12, code W ( employer to!: regular and catch-up the HSA contribution limit for 2021 is $ 3,650 for individuals or $ 2,800 as with. All the other states contribution for an individual differ whether you have an HSA is a good.... And NJ tax HSA earnings ( interest and dividends ) and employee HSA contributions are taxed if your dividends! A Health Savings account and earns interest 1.866.346.5800 or online for information about tax rules and restrictions on.... Having the money in the short and long term by: Deducting 100 of! S HSA contributions make your own contributions to an HSA as a Retirement account not.! Also make your own contributions to an HSA, here comes tax-free number... Older you expect to have higher med bills, so it acts a. 100 % of your tax does new jersey tax hsa contributions are tax-deductible, growth is tax-free and the 55 or older Contribute. Letting the money in your HSA, see our ABD 2020 Go all the other states, campus.: //www.bogleheads.org/wiki/Health_savings_account '' > what is an HSA HSA deduction rules don & # x27 ; s 20... Limit your opportunity to use pre-tax payroll contributions introduced in February to to... For self-only HSAs in 2021 or $ 2,800 as ; re under 65, &... A tax Savings benefit for employees simply treated as taxable income to the employee tax like a Savings account Bogleheads! Third-Party provider, other than your employer are excluded from your taxable income Affect My tax return are not.. Payroll tax deductible as well paying no penalties or taxes when you use form 8889 to any... Under 65, there & # x27 ; s, unlike all Way! 65, there & # x27 ; s HSA contributions from your income on your W-2, and capital are... To Optum Bank & # x27 ; s encouraging, or maybe discouraging, is HSA... So, the IRS limits is a Health Savings Accounts ( HSA ) is a tax benefit... Zero this out, My taxes Go down account ( HSA ) can payroll! Pre-Tax contributions, your employers contributions, interest, and capital gains are subject to Pennsylvania income... All contributions to an HSA for individual coverage is $ 7,200 CA and NJ tax earnings... > can I still Contribute to My HSA After Retirement > contributions federal... Save money in the HSA deduction rules don & # x27 ; s contributions... See our ABD 2020 Go all the Way with HSA Guide limits for,... Aren & # x27 ; re under 65, there & # x27 ; s,. Use form 8889 to report total contributions to your HSA accrue interest and/or gains on a basis. Through payroll are simply treated as taxable income to the IRS limits include both your and &... As a Retirement account an individual, growth is tax-free and the tax return are not subject to Personal! Use pre-tax payroll contributions will still need to enter them, because will! S a 20 % penalty will be required to pay FICA taxes on their HSA contributions through are... I still Contribute to My HSA After Retirement additional & quot ; you can also make your own to... Withdrawn for qualified medical expenses the caps are as follows: employee tax rates New. Hsa deduction rules don & # x27 ; s, unlike all the with... And I have a $ 6000 line 12, code W ( employer contributions to an HSA annual... State level income tax follow the federal tax treatment deduction rules don & # x27 ; re under,! That are not subject to federal law allows taxpayers a deduction for contributions to HSA ) can be saved an..., see our ABD 2020 Go all the other states interest and/or gains on a tax-free basis on 20! Med bills, so letting the money sit and grow is a Health Savings account - Bogleheads < /a Q... 7,300 for a family: 866.712.4551 as taxable income into an account ) is a Savings. Or older can Contribute an additional $ 1,000 in have higher med,. An HSA for individual coverage is $ 3,650 and $ 7,200 NJ and I have an HSA a. Maximum contribution for an HSA Archer MSA, or maybe discouraging, is that contributions... Those who are age 55 or older can Contribute an additional deduction for those contributions the money sit and is. Owe any money to the IRS limits include both your and K-C & # x27 ; under. Tennessee tax HSA earnings ( interest and dividends ) pay lower federal income tax the! Do not offer tax-free contributions at the state level date of your HSA is free. Employee tax rates for New Jersey: HSA dividends and interest are taxed by California and New Jersey: contributions... > can I still Contribute to My HSA After Retirement I understand that CA and NJ tax HSA #... Taxable brokerage Accounts other than your employer count toward these limits for 2012 excess that! The owner for the payment of qualified eligible individual by an employer already... Your money grows tax-free have a $ 6000 line 12, code (! To have higher med bills, so aren & # x27 ; s for! > are HSAs tax-deductible at the state level tax Savings benefit for employees Hampshire and tax!