Want to Save on Taxes in 2020? These Accounts Can Help

By now, you may know about the powerful benefits of using the Hitachi Vantara 401(k) Retirement Savings Plan and Health Savings Account (HSA) to save for your future. But have you overlooked another big advantage to these special savings accounts? Any contributions you make pre-tax not only help you save for tomorrow but also lower your taxable income today.

Tell Me More About Paying Less in Taxes

When you contribute on a pre-tax basis to the Hitachi Vantara 401(k) or HSA (if you’re eligible), the money is taken from your paycheck before federal and state income taxes are withheld. So your annual taxable income is lowered, helping you to possibly pay less taxes come tax time. 

Plus, any earnings that you accrue in your 401(k) or HSA grow on a tax-deferred basis. For the 401(k), that means money earned beyond what you contribute is not taxed until you begin withdrawing from your 401(k) account, which likely won’t be until after you retire, when your taxable income bracket is lower. (Did you know? Withdrawals from the HSA may be taken at any time and are tax-free, too, as long as the money is used for eligible healthcare expenses.)

More Good News About the 401(k) and HSA

Beyond saving on taxes, here are a few reasons why contributing to either the 401(k) or HSA is a good move: 

  1. Free money from us. Hitachi Vantara contributes to both the 401(k) and HSA when you enroll and contribute your own money. (For the HSA, you just have to open the account to receive Hitachi Vantara’s contribution.)
  2. Both accounts are yours, always. Even if you leave Hitachi Vantara or retire, you won’t lose the money in either account. 
  3. Flexibility to fit your needs. Each account comes with options, like paying now for eligible healthcare expenses or saving for future ones, or saving pre-tax, after-tax or a combination of both in your 401(k). So you aren’t stuck with a one-size-fits-all approach to saving money.
  4. The option to invest your money. Both the 401(k) and HSA give you investment options that can help you grow your account balances over time. 

Don’t need a tax break now, but could use one later? Roth 401(k) contributions are taxed now so you don’t pay taxes on money you withdraw in retirement. Learn more about the benefits of the 401(k) and HSA.