The IRS has released inflation adjustments to Health Savings Account limits and High Deductible Health Plans for 2025! Consumer driven health accounts offer advantages to both employers and employees.
Employers save in FICA/Medicare taxes for contributions, generate higher employee satisfaction and retention rates, and increase interest from job applicants. Employees save on Federal/State income taxes as well as FICA/Medicare taxes, have better control over healthcare decisions and experience more healthcare affordability.
HSA: Must have a high deductible health plan (HDHP) to open a health savings account (HSA).
Medical FSA: Can be paired with Medical Plans other than HDHP Plans.
Limited Purpose FSA: Can be used for expenses such as Dental and Vision. Participants in a HDHP Medical Plan are eligible. This plan can be paired with a Health Savings Account (HSA).
Tax Information Regarding HSA and FSA Accounts - Plans can offer a smart way for employees to save for medical expenses with triple tax benefits:
