Take a second look at your medical spending

Have you already spent the money you set aside in your Flexible Spending Account (FSA) for 2017?

Have you contributed the maximum amount to your Health Savings Account (HSA) ($3,400 for individuals & $6,750 for family coverage)?

Consider increasing your FSA contribution for 2018. Remember it is a use it or lose it contribution, but if your medical expenses are consistent or predictable consider an increase. Your contribution decreases your taxable income.

Your HSA contributions are not a use it or lose contribution. You can keep your HSA contributions in your account beyond the current year so the account can accumulate well into the future. You also don't have to make the contribution through your employer (paycheck). You can make the contribution directly to the HSA account and can be made up through the due date of your tax return. So, this is a tax strategy you can implement during the preparation of your taxes and does not have to be done by the end of the year. Like the FSA contribution an HSA contribution decreases your taxable income.

If you became eligible during the year to make HSA contributions you can make a full year's worth of deductible HSA contributions for 2017.