Health Insurance New Jersey NJ

Reader’s Question:

I have a high-deductible health insurance policy that qualifies me to set up a health saving account. At the same time, I want to save money in a tax-free account for my future health care expenses. Is there anything that I can do? I live in New Jersey.

Lisa

Camden, NJ

There’s always something for you, Lisa.

If you’re one of those who have already spent a lot on health care expenses, then you deserve a tax break more than anyone else! Certainly you can always find ways to reduce your health care costs. Since you have a high-deductible health insurance plan in New Jersey, then it’s about time that you should now open a Health Savings Account. This is among the tax-preferred health accounts which you can establish and contribute. Your employer or family member may also contribute to this health account. Maximum contributions may be up to $2,850 for those in a single-person health insurance plan or $5,650 for a family plan, depending on the insurer (this can change each year though). The good thing about this account is that the account balance carries over from one year to the next. You may also take it with you if you decide to leave your job since you really own the account.
You may spend this on qualified medical expenses as defined except for insurance premiums. For COBRA coverage, this can be spent on premiums. Aside from medical expenses, you can always withdraw the funds to pay for non-medical expenses but there will be penalties unless you are disabled or over 65.