Finding the Right Tax-Advantaged Account to
Fund Your Health Care Expenses
health care costs continuing to climb, tax-friendly ways to
pay for these expenses are more attractive than ever.
Health Savings Accounts (HSAs), Flexible Spending Accounts
(FSAs) and Health Reimbursement Accounts (HRAs) all
provide opportunities for tax-advantaged funding of health
care expenses. But what's the difference between these three
accounts? Here's an overview:
If you're covered by a qualified high-deductible health plan (HDHP),
you can contribute pretax income to an employer-sponsored HSA
- or make deductible contributions to an HSA you set up
yourself - up to $3,350 for self-only coverage and $6,750 for
family coverage for 2016. Plus, if you're age 55 or older, you
may contribute an additional $1,000.
You own the account, which can bear interest or be invested,
growing tax-deferred similar to an IRA. Withdrawals for
qualified medical expenses are tax-free, and you can carry
over a balance from year to year.
Regardless of whether you have an HDHP, you can redirect
pretax income to an employer-sponsored FSA up to an
employer-determined limit - not to exceed $2,550 in 2016. The
plan pays or reimburses you for qualified medical expenses.
What you don't use by the plan year's end, you generally lose
- though your plan might allow you to roll over up to $500 to
the next year. Or it might give you a 2 1/2-month grace period
to incur expenses to use up the previous year's contribution.
If you have an HSA, your FSA is limited to funding certain
An HRA is an employer-sponsored account that reimburses you
for medical expenses. Unlike an HSA, no HDHP is required.
Unlike an FSA, any unused portion typically can be carried
forward to the next year. And there's no government-set limit
on HRA contributions. But only your employer can contribute to
an HRA; employees aren't allowed to contribute.
Questions? We'd be happy to answer them - or discuss other
ways to save taxes in relation to your health care expenses. Call us at
SMEED CPA Adds Financial
Services To Help Clients With
Investments & Insurance
often we here at SMEED CPA are asked about financial issues
that impact our clients investments and their portfolios.
We always offered our opinion and suggestions but in order to
help our clients actually execute the changes we suggest,
SMEED has created a Financial Services division.
SMEED Financial Services, Inc. will be able to
work with both individual and business clients on their
investment portfolios and manage assets on their behalf.
SMEED Financial will include Michael Uadiale,
ACA, CPA, CGMA; and Pablo Blanco who has
recently joined SMEED and comes with over 18 years of
financial sales and advising experience with affluent
Watch your inbox and mail boxes for more specific information
on services SMEED Financial Services, Inc will make available
Would You Give Me Your
Feedback & Testimonial
on Our Hotline?
Hello it’s Michael Uadiale, CPA of
SMEED CPA Inc. We’ve just installed a toll-free
number that I would like for you to call and tell me how you
think we are doing as your CPA firm.
Just dial 800-609-9006
extension 3638 and follow the instructions. If we’ve
done a good job please let me know. And if we can
improve on anything, please mention that too.
Us Be Found on
Also as we expand our business,
we find more and more people are using
YELP and Google
to look for us by searching Brentwood accountant or
When they do this we want to
be FOUND on GOOGLE. One way you can help us
is to give us an
ONLINE REVIEW on our Google Maps/Places listing --->
or on our YELP local listing
click here to go to our Google Listing for SMEED CPA and
click on the
YELP link to go there.
Scroll down to the Review area.
On either site it may say: Been here?
Rate and review
You will click on the Rate and
review link and then log in, then
give us a review!
You can choose between 1 and 5
STARS and write in what you think about the tax or accounting
work we have done for you.
It's that simple. Thank
you in advance for your help and cooperation!
As always you can call our offices if you have any
questions about these or any other accounting related issues, at
Regards, Michael Uadiale, CPA,
Managing Partner, SMEED CPA,