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27 January
Here’s what happens to your HSA when you go on Medicare — and how to keep the tax savings going

FA Center

Tax planning becomes a priority if you’re still working and can no longer fund an HSA

Collage of a serious man superimposed on healthcare forms.
Collage of a serious man superimposed on healthcare forms.

Photo: MarketWatch photo illustration/iStockphoto

Like many savvy retirement savers, you take full advantage of health savings accounts. Every year, you contribute the maximum to your HSA. But once you turn 65 and start Medicare, your HSA eligibility ends and you can no longer add money to an HSA.

If you keep working, you might regret the loss of HSA contributions and the tax advantages they deliver: the pretax contribution made through your employer that reduced your taxable income each year, and the tax-free growth of the invested funds.