Your HSA or FSA tax savings

How we calculate this

We find your marginal tax rate by placing your income in the 2026 federal income-tax brackets from IRS Rev. Proc. 2025-32, then multiply your contribution by that rate to estimate the federal income tax you avoid. For a payroll-deducted HSA we add the 7.65% FICA employee payroll tax (6.2% Social Security plus 1.45% Medicare), which an employer-routed HSA skips and a personal one generally doesn’t.

One honest approximation: the federal brackets apply to taxable income — your income after the standard deduction and any other deductions — but this tool uses the income figure you enter, which is usually gross. That can place you a bracket high and slightly overstate the rate, so treat the result as a planning estimate. We also leave out state income tax, which many states waive on HSA and FSA contributions too, so your actual savings may run higher than what we show. This isn’t tax advice; confirm with the current IRS guidance or a tax professional before you decide.

Frequently asked questions

How much does an HSA or FSA actually save me on taxes?

The money you contribute is pre-tax, so it’s subtracted from your taxable income. Your savings equal your contribution multiplied by your marginal tax rate — the rate on your last dollar of income. Contribute $3,000 at a 22% marginal rate and you keep about $660 in federal income tax. If your HSA is deducted straight from your paycheck, you also skip the 7.65% FICA payroll tax on it, which most personal HSA contributions don’t avoid. This tool does that math for your numbers.

Do I need a special health plan to open an HSA?

Yes. You can only contribute to a Health Savings Account if you’re enrolled in an HSA-eligible high-deductible health plan, an HDHP. If you’re not on one, you can’t make HSA contributions, so the savings here wouldn’t apply yet. A health FSA, by contrast, is offered through an employer and doesn’t require a high-deductible plan. If you want the HSA path, you’d shop for an HSA-eligible plan first.

What’s the difference between an HSA and a health FSA?

An HSA is yours: the money rolls over year to year, stays with you if you change jobs, and can be invested. It requires an HSA-eligible high-deductible plan. A health FSA is set up by an employer, is generally use-it-or-lose-it within the plan year (with at most a small carryover or grace period your employer chooses), and you forfeit unused money if you leave. Both let you pay for medical costs with pre-tax dollars, which is where the tax savings come from.

Are there limits on how much I can contribute?

Yes. The IRS sets a maximum annual contribution for both HSAs and health FSAs, and the amounts change every year — HSAs also have separate individual and family limits and an extra catch-up amount at 55 and older. Because those figures move, we don’t hardcode them here; check the current IRS limits for the year you’re contributing before you decide on an amount. The savings estimate scales with whatever contribution you enter.