Tax Deductible Savings
June 6th, 2009
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Question: What are disadvantages of HSA health insurance?
I am thinking about buying an HSA. This is the higher Deductible Health insurance with a Tax Deductible Savings Account. What are the drawbacks?
Answer: Are you healthy?
Do you have the deductible handy in the event you need it?
While the paperwork is reduced, you still need to know a few basics–such as if you see a doctor who is in network, you get the network price even though you are paying for it (before the deductible is hit).
I have been on one for a few years and have developed a nice little slush fund that isn’t use or lose like an FSA. What I don’t like is my particular HSA doesn’t have as many doctors in network as BC/BS. (I’m debating swtiching back…the HSA is still useable, I just wouldn’t be able to add to it.)
One ridiculous downside is the extra form at tax time. You have to file an honesty report with a 1040 if you either put money in (even through work) or take money out. If you are single, the form isn’t too bad, but it’s ridiculously complex if you are married. The rule is that you only get a tax deduction for money you paid with after tax dollars. While I put in $3000 this year, $720 was through the employer and I don’t get to deduct that twice.
Items on Amazon Right Now for Tax Deductible Savings:
Lots to look forward to in 2010
The New Year is upon us, bringing with it all kinds of changes, big and small, good and, well, not so good.
Personal Financial Planning Tips : How to Design a Savings Plan
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Posted in List of Tax Deductions | 
Tags: 529, college, health, hsa, savings, tax deductible savings account