Are HSA contributions tax deductible in Wisconsin?

Effective for taxable years beginning in 2011 and thereafter, Wisconsin follows the provisions of Public Law 108-173 relating to health savings accounts. Eligible individuals may claim a deduction on their federal income tax returns for contributions to the HSA.

Do you pay state taxes on HSA contributions?

State income taxes are also waived on HSA contributions in almost all states, with the exception of California, New Jersey, and Alabama.

Why is my HSA contribution being taxed?

An HSA is a tax-exempt account used to pay or reimburse qualified medical expenses that generally would be eligible for the medical and dental expenses deduction. The amounts contributed to an HSA gain interest tax-free, and the account stays with you even if you change employers or leave the workforce.

Do HSA contributions reduce your taxable income?

A health savings account (HSA) is a tax-advantaged way to save money. HSA contributions reduce taxable income, investment growth in the account is tax-free, and qualified withdrawals are tax-free. Money leftover at the end of the year in an HSA is not forfeited like money leftover in a flexible spending account (FSA).

Can you deduct health savings account contributions?

You can claim a tax deduction for contributions you, or someone other than your employer, make to your HSA even if you don’t itemize your deductions on Schedule A (Form 1040). Contributions to your HSA made by your employer (including contributions made through a cafeteria plan) may be excluded from your gross income.

Do you report HSA withdrawals on taxes?

An HSA distribution is a withdrawal from your health savings account. HSA distributions taken to pay for eligible medical expenses are not taxable, but still must be reported to the Internal Revenue Service (IRS).

Which states tax HSA accounts?

HSA contributions are taxed by California and New Jersey. 2. These states don’t have state income taxes so the state tax benefit is not applicable: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.

What tax is HSA exempt from?

Earnings to an HSA from interest and investments are tax-free. Distributions from an HSA to pay for qualified medical expenses are tax-free.

How do I report my HSA contributions on my tax return?

Use Form 8889 to:

  1. Report health savings account (HSA) contributions (including those made on your behalf and employer contributions),
  2. Figure your HSA deduction,
  3. Report distributions from HSAs, and.
  4. Figure amounts you must include in income and additional tax you may owe if you fail to be an eligible individual.

How do I report HSA contributions on my tax return?