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7 Tax Tips to Use Before 2013 Ends

You've still got a month left to net some serious savings

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Tax Tip #4: Make a large contribution to a Health Savings Account (HSA).

This is only applicable if you have a high-deductible health insurance policy that is compatible with HSAs, but millions of Americans — and particularly the self-employed — fall into this category.

The uncertainty surrounding Obamacare complicates matters in 2014. Assuming no changes to the Affordable Care Act, HSAs still will be available, even if the connected insurance policies are more expensive. But the entire healthcare industry is in a state of flux right now, and HSAs might no longer make sense once the dust settles.

I’m a big fan of the HSA structure because it encourages patients to be more careful with their medical dollars and gives them a degree of power they don’t have with traditional insurance, but you really have to run the numbers for yourself. If a bare-bones insurance policy is all you need, then you might as well take advantage of the tax breaks.

HSA contributions give you a similar tax breaks as traditional IRAs. In 2013, an individual policyholder can contribute a maximum of $3,250, and a family can contribute $6,450. Next year, the limits rise modestly to $3,300 and $6,550, respectively. If you’re age 55 or older, you can chip in an additional $1,000.

Unlike IRAs and Roth IRAs, HSAs are not subject to any income limitations.

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