A health savings account (HSA) can be tax-free going in, while growing and when spent on qualified medical costs. Enter what you and your employer contribute, your tax rates, the medical costs you expect to pay from the account and an investment return to see how much tax you save and how large your HSA could grow.
Last updated:
Contributions
$
$/ yr
$
Enter this year's IRS limit for your coverage (self-only or family), including any catch-up.
$
Taxes
%
%
Use 0 in states that tax HSA contributions.
Spending & growth
$/ yr
% / yr
% / yr
years
Enter your values to see the result.
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How to use the HSA Calculator
Enter your yearly contribution, your employer's contribution and any current balance.
Optionally enter this year's contribution limit to get a warning if you go over.
Enter your federal and state tax rates and tick payroll if you contribute through work.
Add the medical costs you expect to pay from the HSA, the investment return and the number of years.
Read your tax savings and projected balance, and see the year-by-year table.
How the HSA projection works
Tax savings per year = your contribution × (federal rate + state rate + 7.65% FICA if through payroll)
Each year: balance = (start balance + your and employer contributions − medical costs paid) × (1 + return)
If medical costs exceed the money in the account, the shortfall is shown as out of pocket.
Example: $3,000 from you and $500 from your employer each year, 22% federal and 5% state tax through payroll, $1,000 of medical costs a year rising 3%, and a 6% return. You save $1,039.50 in tax every year, and after 20 years the HSA holds about $87,000 even after paying for your care.
Tax saved per $1,000 contributed
Federal rate
No state tax, not payroll
No state tax, payroll
5% state, payroll
10%
$100
$176.50
$226.50
12%
$120
$196.50
$246.50
22%
$220
$296.50
$346.50
24%
$240
$316.50
$366.50
32%
$320
$396.50
$446.50
35%
$350
$426.50
$476.50
FICA savings apply only to contributions made through an employer's payroll (a cafeteria plan), not to contributions you make directly and deduct on your tax return.
Contributions are tax-deductible (or pre-tax through payroll), investment growth is not taxed, and withdrawals for qualified medical expenses are tax-free. No other common US account gets all three benefits at the same time.
How much tax does an HSA save?
Roughly your contribution × your marginal tax rate. Through payroll you also avoid the 7.65% Social Security and Medicare (FICA) tax. For example, $3,000 at a 22% federal and 5% state rate via payroll saves $3,000 × 34.65% = $1,039.50 a year.
Who can contribute to an HSA?
You need to be covered by an HSA-eligible high-deductible health plan (HDHP) and have no other disqualifying coverage, such as Medicare. The IRS sets yearly contribution limits for self-only and family coverage, with an extra catch-up amount from age 55; enter the current limit in the calculator.
Do all states give a tax break on HSA contributions?
No. A few states, notably California and New Jersey, tax HSA contributions and earnings at the state level. If you live in one of them, enter 0% for the state tax rate.
Should I invest my HSA or use it for medical bills?
If you can afford to pay current medical costs out of pocket, investing the HSA lets it grow tax-free for longer, and you can reimburse yourself later for qualified expenses as long as you keep the receipts. If you need the money now, using it for care still gives you the tax savings on contributions.
What happens to my HSA after 65?
After 65 you can withdraw for any purpose without the 20% penalty; non-medical withdrawals are taxed as income, like a traditional IRA, while medical withdrawals stay tax-free. The money is yours even if you change jobs or health plans.
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