Investment

» allancoleman - 2007 HSA data

The federal government has just released their inflation adjusted calculations for 2007 Health Savings Accounts contributions . For 2007 , the maximum contribution allowed for " self - only coverage " is $2,850 compared with $2,700 for this year ( 2006 ) . And the maximum contribution for " family coverage " for 2007 will be $5,650 comparied with $5,450 for this year ( 2006 ) .

Together with the " catch up " provision for those over 55 this year of $800 , that means my total HSA contribution allowed will be $6,450 for next year instead of the $6,150 i put in for this year ( 2006 )

For more information on how these work , see :

http://www.treas.gov/offices/public-affa...

The money put into these act like a " tax credit " on your income tax return and not like a tax deduction . Therefore the money deposited in your HSA comes off the taxes owed and not buried in your return as a deduction might be . For those of you considering these , they are NOT allowed after you reach Medicare age , however can be used after age 65 for Medicare expenses . So , for myself , I have an additional three years to build up my HSA account before I won't qualify anymore .

In addition , the contributions are " pro - rated " and you must begin your contribution in January of the year in order to qualify for the full year's contribution amount . In other words , you can NOT make a full contribution in November or December of a particular calendar tax year .

So those of you wanting to take advantage of these for next year , do your planning now . Remember most people don't plan to fail , they just fail to plan .

-- posted by allancoleman