Healthcare and taxes have always been intertwined, but new tax legislation has made the connection even more significant. For individuals and families with Health Savings Accounts (HSAs) or those considering one, understanding these changes is crucial to maximizing your tax savings. At Lightening the Load, we’re here to help you make sense of these new rules and ensure your tax strategy is as healthy as you are.
The New Rules for HSAs
The new tax bill loosens some of the restrictions around HSAs, making them a more flexible and powerful tax-advantaged tool for healthcare expenses.
- Expanded Telehealth Access: The new law makes permanent the ability for high-deductible health plans (HDHPs) to cover telehealth services before you meet your deductible, without jeopardizing your HSA eligibility.
- Direct Primary Care: A major change is the new ability to participate in Direct Primary Care Arrangements (DPCAs) and still be HSA-eligible. You can also now use your HSA funds to pay for DPCA fees. This opens up new ways to use your HSA to pay for a more comprehensive healthcare experience.
Other Health-Related Tax Changes
Beyond HSAs, the new legislation introduces other tax-related provisions for healthcare and dependents.
- Increased Dependent Care FSA Limits: The annual exclusion from taxable income for dependent care Flexible Spending Arrangements (FSAs) has increased from $5,000 to $7,500. This is a significant benefit for families with childcare expenses.
- Enhanced Adoption Tax Credit: The tax credit for adoption assistance has also been improved, becoming partially refundable, which can provide much-needed relief for families.
Healthcare and taxes are now more intertwined than ever. We can help you understand the new rules and maximize your health-related tax savings.
