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Reduce Your Medical Expenses

9/20/2022

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Tax smarts that make a difference

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Medical expenses are on the rise. According to the Milliman Medical Index, the average family of four on an employer-sponsored plan will spend $30,260 on healthcare in 2022 – a $4,699 increase from 2020. Below are some ways you can save tax dollars when paying those medical bills:
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  • Contribute to a Health Savings Account (HSA). If you have a high deductible health plan, you can open an HSA account to pay your medical bills. If your health insurance deductible is $1,400 ($2,800 for family) or more, you can make contributions to an HSA to reduce your taxable income. The HSA contribution limit is $3,650 for 2022 ($7,300 for family).
  • Contribute to a Flexible Savings Account (FSA). Unlike an HSA, an FSA has to be set up by your employer. Like an HSA, you and your employer can make pre-tax payroll contributions to the account to cover qualified medical expenses. One benefit of an FSA is your total annual election amount is available to you on Jan. 1. On the flip side, if you don’t use your FSA dollars by year-end, you lose the funds.
  • Deduct your self-employed health insurance premiums. If you are self-employed, you can deduct amounts paid for health insurance premiums for you and your family. To be eligible to make the deduction, your self-employed business needs to show a profit for the tax year. This is an above-the-line deduction, so it can reduce your taxable income even if you are claiming the standard deduction.
  • Deduct medical expenses as an itemized deduction. For 2022, the IRS will allow you to include medical expenses that exceed 7.5 percent of your adjusted gross income (AGI) as an itemized deduction. For example, using the US Census Bureau’s average household income of $67,500, any medical expense above $5,063 may be deducted. If you are not taking the standard deduction, these medical expenses can be used to reduce your income.


If you would like to discuss how these options may work for you, please call.

"Tax Tips" are published to provide current tax information, tax-cutting suggestions, and tax reminders. If you would like more information on anything in "Tax Tips," or if you'd like to be on our mailing list to receive other tax information from time to time, please contact our office.
 
The tax information contained in this site is of a general nature and should not be acted upon in your specific situation without further details and/or professional assistance.
 
We are trusted CPA advisors servicing Burr Ridge, Hinsdale, Willowbrook, Darien, Naperville, and all Chicagoland area. 

Do you need assistance with your business and/or personal tax returns? Would you like to have a trusted source for your accounting, allowing you additional time to focus on increasing your business? Do you use QuickBooks, or plan to in the future, for your accounting? We include these in all our service packages, customized to fit your personal or business needs.  
 
We are currently accepting new clients. Your initial consultation is free, so you have nothing to lose and everything to gain. Our experienced staff is available to help you streamline your accounting, giving you more free time for yourself. Set up an appointment today by calling (630) 320-3720 or email us at info@monarchaccountinggroup.com. 
 
For more free resources, such as Tax Organizers, and Record Retention Schedules, access our website www.monarchaccountinggroup.com.

Mia Verc, CPA;  Janice Papais, CPA
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Phone: (630) 320-3720

Monarch Accounting Group Inc
145 Tower Drive, Suite 4
Burr Ridge, IL 60527-7836
Email: Info@MonarchAccountingGroup.com


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  • Home
  • Solutions
    • CFO Services
    • Cloud ACCOUNTING
    • Bookkeeping Services
    • QuickBooks Training
    • Income Taxes
    • Other Services
  • Resources
    • Tax Rates
    • SmartVault
    • Tax Tips
    • Tax Organizer
    • Record Retention Schedule
  • Reviews
  • Meet Us
  • Blog
  • Contact Us