What is the tax liability for employer contributions in Health Savings Accounts (HAS's)?

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Multiple Choice

What is the tax liability for employer contributions in Health Savings Accounts (HAS's)?

Explanation:
Employer contributions to Health Savings Accounts are a tax-free benefit. The amount the employer contributes is excluded from the employee’s gross income for federal income tax and isn’t subject to payroll taxes in the year it’s contributed. In other words, no tax is owed by the employee on that employer contribution (as long as total contributions stay within the annual limit; excess contributions would be taxable). That’s why the correct choice is that no tax payment is needed for the employer’s contribution.

Employer contributions to Health Savings Accounts are a tax-free benefit. The amount the employer contributes is excluded from the employee’s gross income for federal income tax and isn’t subject to payroll taxes in the year it’s contributed. In other words, no tax is owed by the employee on that employer contribution (as long as total contributions stay within the annual limit; excess contributions would be taxable). That’s why the correct choice is that no tax payment is needed for the employer’s contribution.

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