It’s that time of the year again… tax season! April 15 is the deadline to file 2024 taxes in 2025. We know there aren’t too many people who get excited about filing their taxes, but here’s some information that could help ease the burden:

Did you know you can contribute up to the maximum into your health savings account (HSA) even if you can’t itemize your deductions? HSA contributions reduce taxable income. Investment growth in the account is tax-free. And qualified withdrawals are also tax-free. If you have an account but haven’t stayed up-to-date on your balance, we encourage you to take a look at the numbers and find out your total HSA contribution last year.

If you’re able to contribute the maximum for 2024, it’s a smart idea to do so. Not only do you benefit from an HSA’s triple-tax advantage, but the money is yours for life. Contributions are vested, and account balances can always be carried forward. Medical expenses tend to increase as you get older, especially once you pass retirement age. That means starting an HSA early and contributing regularly go a long way toward securing your financial future.

Here are a few common questions about the tax benefits of an HSA, answered by Sandy Gleason, VP, Industry Consulting at Alegeus.

Adding funds, up to the maximum amount for their coverage type, will reduce their taxable income even if they are not able to itemize on their taxes. This is considered an ‘above the line’ deduction, and it may even put an individual into a lower tax bracket.

For the latest annual contribution limits, check here.

If an individual had disbursements from their account in 2024, they will receive a 1099-SA showing the gross distribution amount. When filing their taxes, they will need to report their HSA disbursement amount. They’ll also need to answer whether the disbursement was for qualified healthcare expenses. If the disbursement was not for eligible healthcare expenses, the amount will be taxable and, if the taxpayer is under age 65, a 20% penalty will apply.

If the individual had excess contributions to their HSA (contributed over the amount of the IRS limit for that year), they can correct it by removing the excess contributions from their HSA prior to filing their taxes. The excess amount and any interest attributable to that amount should be reported as income on their taxes. If not removed and reported on their taxes, they are subject to income tax and a 6% penalty until the amount is corrected.

You can read more common questions about HSAs (and the answers to them!) here.