Are you a beneficiary of any health savings account? If yes then by now you must have come across a tax form called IRS form 8889
. You have to fill out this tax form with your annual income tax return so that you can report your deductible contributions to the IRS. Now your mind must be wondering What is IRS Form 8889
In this tax form, all these deductions are calculated and the distribution taken for medical expenses is reported. Along with this, the tax amount that you have to pay on the withdrawals made by you for any non-medical purposes is also calculated with the help of this form. A Health Savings Account lets you make contributions. These contributions can be made on a yearly basis and are tax-deductible. The contribution amount can be $3,500 for individual plans or $7,000 for family plans. These are made to help pay for some medical expenses in the future.
It is not like that every U.S. taxpayer can have a Health Savings Account. In order to qualify for this, an individual has to enroll himself in a health insurance plan. And that insurance plan has to impose high deductibles. These amounts have to be equal to or more than the specific amount set by the IRS. The insurance plan also has to impose maximum annual cost ceilings. And this limitation is also decided by the IRS.
A person is not eligible to have an HSS if he/she:
Has other first-dollar medical coverage
Or has enrolled in Medicare
Has been claimed as a dependent by another taxpayer
By now you must have understood that it is important to file all the tax forms on time. In the above blog, we have explained IRS Form 8889
in great detail. Still, have some questions? It is not an uncommon thing to happen. If you want to know how to get started or have any other queries then you can take help from our large team of experienced and dedicated tax professionals. We are just a call away. You can contact us on +1-866-301-2307
You can call us anytime as we are available 24×7.