HSA News for April 1, 2024
HSA news is provided by Mr. HSA, Roy Ramthun.
News from Washington
IRS Announces Tax Relief for Taxpayers Impacted by Severe Storms, Landslides and Mudslides in Alaska; Various Deadlines Postponed to July 15
The Internal Revenue Service announced tax relief for individuals and businesses in the Wrangell Cooperative Association of Alaska Tribal Nation that were affected by severe storms, landslides and mudslides that began on November 20, 2023. These taxpayers now have until July 15, 2024 to file various federal individual and business tax returns, make tax payments, and make 2023 contributions to IRAs and HSAs.
IRS Further Extends Tax Relief for Hawaii Wildfire Victims; 2023 Returns, Payments, Other Deadlines Postponed to August 7
The Internal Revenue Service further postponed various tax-filing and tax-payment deadlines for individuals and businesses affected by the August 8, 2023, wildfires in Hawaii. The previous deadline was February 15, 2024. These taxpayers now have until August 7, 2024 to file various federal individual and business tax returns, make tax payments, and make 2023 contributions to IRAs and HSAs.
HSA Studies & Analysis
Devenir Report Highlights Booming HSA Asset Growth, Reaching $123 Billion
Devenir released the results of its 27th semi-annual Health Savings Account survey and resulting research report. Devenir found that there was about $123 billion saved in over 37 million HSAs at the end of 2023. Devenir currently projects that the HSA market will approach 44 million accounts by the end of 2026, holding $168 billion in assets.
2023 Year-End Devenir HSA Research Report
Devenir's research found that year-over-year HSA assets increased 19% and accounts rose 5%. HSA investment assets grew 37%, totaling $46 billion at the end of the year. About 2.9 million HSAs (almost 8% of accounts), have at least a portion of their HSA dollars invested.
HSAs as Investments on the Rise, but Use Still Low
According to new data from the Employee Benefit Research Institute, few people are taking full advantage of the “triple tax benefits” of HSAs. While HSAs are touted for their use as investment accounts, only 13 percent of owners used them in that capacity in 2022. But that’s a dramatic increase from several years ago, as 12 percent of accounts were invested in 2021 and just 2 percent in 2011.
HSA Compliance Corner
What Every Medicare Rep Should Tell HSA Owners
Health Savings Accounts and Medicare are incompatible. If you're enrolled on any Part of Medicare, you're not eligible to continue funding your HSA. That's true even if you remain active at work (what we call a working senior), enrolled on your company's HSA-qualified medical plan, and meet all other eligibility requirements.
Are Patients Limited to Certain Providers on HSA Plans?
Does an HSA-qualified plan restrict which doctors or facilities I can see to receive care? It may or may not. Insurers build their HSA-qualified plans on standard product chassis like an HMO, PPO, or POS plan. Some of these products allow you to receive care outside the network at a reduced benefit level.
HSAs & Retirement
HSA vs. 401(k): Compare and Contrast
Saving for retirement is only half the battle -- you also have to pick the right accounts. A 401(k) is designed for retirement savings, whereas an HSA is intended for medical savings, although it has appealing perks for retirement savers as well. Here are some of the pros and cons of each type of account so you can decide which one is best for you. Participate in both if you can.
How Retirees Can Benefit Handsomely from a Health Savings Account
Health Savings Accounts are among the most valuable but most overlooked tools for financing a sound retirement. The enormous tax advantages of HSAs are why folks who are shrewd pour money into an HSA year after year during their working lives. Some of these savers even leave the money untouched with the goal of turning the HSA into a de facto retirement account.
Half of Boomers Have Less Than $50K for Retirement — It’s Not Too Late to Save More
According to a survey by GOBankingRates, over 60% of Americans have less than $50,000 saved for retirement. It’s not surprising that younger generations have less saved for retirement,
but it’s more concerning that over half of those approaching retirement don’t have much saved for retirement when it may only be a few years away.
This Expense May Disrupt the Great Wealth Transfer — Unless You’re Prepared
Baby boomers are discovering higher than anticipated costs, forcing many to spend their precious savings on long-term care and unexpectedly high healthcare costs. Not only does this mean that Gen X and millennials shouldn’t count on legacy money coming to them, but they should instead aim to get a jump on their future healthcare planning as soon as possible.
Maximizing Your HSA
How Much Should I Contribute to My HSA?
At first glance, contributing the IRS-allowed maximum to your HSA in one year may sound unimaginable. But when taking into account the premium savings of an HSA-qualified plan compared to a traditional health plan, plus tax savings gained through contributing to an HSA, it becomes more realistic.