Report contributions to a health savings account hsa. Part iii administrative, procedural, and miscellaneous. Medical fsa and hsa expense eligibility list updated 0721 2015 skin drugs or medicines that must be prescribed in order to qualify. Health savings accounts examples of eligible expenses. Because hsa spending is tax deductible, the irs requires that you maintain proof that any hsa funds spent were for hsa eligible expenses. Use these tables to determine which products and services are considered qualified medical expenses under irs rule and what supplementary documentation you may need to. Datapath summit features allinone, cloudbased hsa administration, with management, investments, and flexible banking options.
Aug 14, 2014 flexible spending accounts fsas and health savings accounts hsas allow individuals to use pretax or taxfree dollars to pay for eligible medical expenses. Form 8889 is the irs form that helps you to do the following. Qualified medical expenses qme are designated by the irs. Flexible spending arrangements fsas p15 irs tax map.
To help you better understand hsaeligible health plans, hsas, and how the two work together, here are answers to some commonly asked questions to help you get started. Qualified medical expenses the internal revenue service defines qualified medical care expenses as amounts paid for the diagnosis, cure or treatment of a disease, and for treatments affecting any part or function of the body. Information to help make the most of your new health. Any funds you withdraw for nonqualified medical expenses will be taxed at your income tax rate plus 20% tax penalty if youre under 65. Medical expenses that can be reimbursed through your medical spending account potentially eligible.
Or, you can choose to save your hsa dollars and pay eligible expenses yourself. It is the hsa account holders responsibility to determine whether a particular expense is a qualified medical expense. You can also see a list of all nonhsa qualified expenses. An hsa is a bank account with money used to pay health care costs.
The irs announced 2015 individualfamily contribution limits for health savings accounts hsas, and highdeductible plan minimum deductibles and maximum outofpocket expenses reflecting. You can use the hsa to pay for qualified medical expenses for yourself, your spouse and your dependents before the hdhp deductible is met, as well as for other healthcare expenses allowed under section 2d of the internal revenue code irc. Rxmn eligible for reimbursement with a doctors noteprescription for products or a medical necessity form for services. Benefits eligible hsa and fsa expenses eligible expenses guide. View a list of all the health savings account hsa qualified expenses for 2020. Flexible spending accounts fsas and health savings accounts hsas allow individuals to use pretax or taxfree dollars to pay for eligible medical expenses.
A health reimbursement arrangement hra must be funded solely by an employer. The following list provides examples of eligible and ineligible medical expenses. Employees are reimbursed tax free for qualified medical expenses. The examples listed here are not allinclusive, consult your tax advisor or see irs publication 502 or irs publication 969 for more information. You can use your health care fsa or hra to reimburse yourself for medical and dental expenses that qualify as federal income tax deductions whether or not they exceed the irs minimum applied to those deductions under section 2d of the tax code. If you have an hra, your employers plan may only reimburse a subset of expenses.
You can pay for a wide range of irsqualified medical expenses with your hsa, including many that arent typically covered by health insurance plans. A health flexible spending arrangement fsa allows employees to be reimbursed for medical expenses. Employee irs eligible expenses health savings account hsa. You can deduct on schedule a form 1040 or 1040sr only the part of your medical and dental expenses that is more than 7. About publication 502, medical and dental expenses. Then, a taxdeductible savings account is opened to cover current and future medical expenses. Once funds are available in your hsa, payflex makes it easy to pay for your eligible expenses. See pages 1920 for more information on crossover see pages 56 for more information about hsa eligibility. An hsaeligible health plan is an hdhp that satisfies certain irs requirements with respect to deductibles and outofpocket expenses. Jan, 2016 an hsa may receive contributions from an eligible indi vidual or any other nated by medicare to be used solely to pay the qualified medical. For a complete list and more detailed information, please refer to irs publication 502 titled medical and dental expenses.
Publication 969 2019, health savings accounts and other tax. Health savings accounts hsas a health savings account hsa is a tax exempt trust or custodial account you set up with a qualified hsa trustee to pay or reimburse certain medical expenses you incur. Hsa irs contribution limits and guidelines hsa bank. Eligible medical expenses for hsas are defined in section 2d of the internal revenue code. Expenses marked with an asterisk are potentially eligible expenses that require a note of medical necessity from your health care provider, which should be kept with your receipt for the expense. In order for your funds to remain tax free, you have to spend them according to the irs tax code. Please refer to your plan document for confirmation of reimbursable expenses under your plan. For 2015, higher limits for hsa contributions and deductibles. Flexible spending arrangements fsas p15 irs tax map archive.
Participants enroll in a relatively inexpensive high deductible insurance plan. Form 1040x can be filed for the year or years the expenses are treated as paid, unless the period for claiming a refund has passed. To help you better understand hsa eligible health plans, hsas, and how the two work together, here are answers to some commonly asked questions to help you get started. Uploading a quick photo of the receipt to trackhsa ensures that if the irs comes knocking, you can justify all of your hsa spending and the health tax breaks they offer.
Other expenses normally eligible under a standard fsa arent eligible under a limitedpurpose fsa. There are thousands of eligible expenses for taxfree purchase with a health savings account hsa, flexible spending account fsa, and health reimbursement arrangement hraincluding prescriptions, doctors office copays, health insurance deductibles, and coinsurance. This includes deductibles, coinsurance, prescriptions, dental and vision care, and more. There are thousands of eligible expenses for tax free purchase with a health savings account hsa, flexible spending account fsa, and health reimbursement arrangement hraincluding prescriptions, doctors office copays, health insurance deductibles, and coinsurance. The information provided herein is general in nature and provides examples of eligible qualified medical expenses based on irs publications 502 and 969 and other irs guidance. The internal revenue service defines qualified medical care expenses within irs section 2d. Find out what you can buy with your health account. The amount you spend will be federal income taxfree. Irs 8889 2015 fill out tax template online us legal forms. For more information on eligible expenses covered by your specific program refer to. Your fidelity hsa health savings account provides a couple of great advantages.
Report distributions you took from the hsa hopefully for eligible medical expenses. The contribution cannot be paid through a voluntary salary reduction agreement on the part of an employee. You must be an eligible individual to qualify for an hsa. Hsa you can use your hsa to pay for eligible health care, dental, and vision expenses for yourself, your spouse, or eligible dependents children, siblings, parents, and others who are considered an exemption under section 152 of the tax code. Hsa funds are not forfeited at the end of the plan year. Information to help make the most of your new health savings.
The irs has extended the tax deadline from april 15th to july 15th. Irs limits are indexed for inflation on an annual basis. See irs publication 502 section 2 d for a full list of eligible expenses hydrotherapy under healthcare reform, hsa and fsa funds can no longer be used to purchase overthecounter medications such as aspirin, allergy and cold medications, etc. No permission or authorization from the irs is neces sary to establish an hsa. Proof of qualified expenses is the hsa account holders responsibility. Medical fsa and hsa expense eligibility list updated 0721 2015 the following is a summary of common expenses claimed against medical flexible spending account fsas and health savings accounts hsas. No employment or federal income taxes are deducted from your contribution. No permission or authorization from the irs is necessary to establish an hsa. Restrictions on frequency or amount of distributions xi. Qualified expenses for a health savings account hsa. You can pay for a wide range of irs qualified medical expenses with your hsa, including many that arent typically covered by health insurance plans. A health savings account hsa is a taxexempt trust or custodial account you set up with a qualified hsa trustee to pay or reimburse certain medical expenses you incur.
Can be used for expenses typically not covered by a medical, vision, and dental plans, such as copayments for doctors office visits, dental, optical care, prescription drugs, health and dental deductibles, etc. Types of qualified medical expenses that health savings. You can deduct on schedule a form 1040 only the part of your medical and dental expenses that is more than 7. Medical expenses include dental expenses, and in this publication the term medical expenses is often used to refer to medical and dental expenses. An hsa eligible health plan is an hdhp that satisfies certain irs requirements with respect to deductibles and outofpocket expenses.
Eligible expenses include health plan copayments, dental work and orthodontia, eyeglasses and contact lenses, and prescriptions. With an hsa, you can gain more control over how your. Eligible expenses in an hra will vary depending on plan design. The sample list below is generally considered eligible expenses for reimbursement based on irs code section 2 d. Medical care expenses are further defined as amounts paid for the. Health savings accounts medical expenses annual hsa contribution limits for 2015 are. A list of these expenses is available on the irs website. Use the payflex card, your account debit card if offered. About publication 969, health savings accounts and other. They include medical, dental, vision and prescription expenses. Health savings accounts hsas a health savings account hsa is a taxexempt trust or custodial account you set up with a qualified hsa trustee to pay or reimburse certain medical expenses you incur. The hsa for life1 health savings account make a smart investment in a health savings account hsa.
Feb 11, 2020 medical expenses include dental expenses, and in this publication the term medical expenses is often used to refer to medical and dental expenses. For full hsa eligible expenses and guidelines, refer to irs publication 502 or contact your hsa administrator. Hsa examples of eligible expenses amazon web services. Family plans that do not meet the high deductible rules. The irs defines an eligible medical expense is an expense that is used to diagnose, cure, mitigate, treat or prevent disease, or for the the purpose of affecting any structure of or. Health hsa eligible expenses health savings accounts. Qualified medical expenses for a limitedpurpose fsa are restricted to qualified outofpocket costs for dental and vision care. Fsas are usually funded through voluntary salary reduction agreements with your employer. Calculate your tax deduction from making hsa contributions. Certain health insurance premiums are eligible to be paid out of an hsa. The limit on contributions made to health savings accounts hsa and restrictions on deductible and outofpocket expenses for 2015 were released by the irs in its annual inflationadjusted report. It discusses what expenses, and whose expenses, you can and cannot include in figuring the deduction. No employment or federal income taxes are deducted from your. Eligible medical expenses are defined as those expenses paid for care as described in sections 2 d or irs publication 502.
Due to frequent updates to the regulations governing fsas and hsas, this list. Most major grocery, department, retail and drug stores can identify at the cash register what supplies are eligible for reimbursement. Money used for eligible healthcare expenses is always taxfree keep good records and save your receipts the irs may require that you prove that money taken from your hsa advantage account was used for eligible expenses, so keep your proof with your tax information for at least three years. Eligible expenses may be paid from your hsa for yourself, your spouse, and other qualified tax. Individuals may continue to make 2019 hsa contributions through july 15, 2020. In order to determine eligibility for potentially eligible items, further requires a letter of medical necessity linked below from your health care provider ineligible. Distributions made from an hsa to reimburse the account beneficiary for eligible expenses are excluded from gross income. Expenses are paid automatically, as long as funds are available. The irs determines which expenses are eligible for reimbursement. Products and services that are not eligible for hsa or fsa reimbursement. To be a qualified expense, the expense has to be primarily for the prevention or alleviation of a physical or mental defect or illness. We began writing the first edition of the complete hsa guidebook a few months after the original hsa law became effective on january 1, 2004. It is remarkable to see the change in peoples understanding and acceptance of hsas over the past 15 years. Hsa eligible expensesqualified hsa expenses wageworks.
First, it gives you a taxadvantaged way to pay for qualified medical expenses1 for yourself, your spouse, and your dependents. The irs sets limits each year for maximum contributions to each type of accountbased benefit. If you enroll in an hsaeligible health plan, you should consider opening an hsa. In addition to the required detailed receipt, you will need to submit a letter of medical necessity, signed by your doctor, to verify this expense is a. The expenses associated with the adoption of a child are not eligible for reimbursement with a flexible spending account fsa, health savings account hsa, health reimbursement arrangement hra, limited care flexible spending account lcfsa or dependent care flexible spending account dcfsa. Eligible individuals and their family members may make deductible contributions to. For additional information on hsa eligible expenses, consult. To ensure compliance with requirements imposed by the irs, aetna informs you that any federal income tax information contained in this communication including any attachments is not intended to and cannot be used by anyone to avoid irs penalties. It explains how to treat reimbursements and how to figure the deduction. Dec 03, 2016 hsa and medicare eligibility irs rules. Employees are reimbursed tax free for qualified medical expenses up to a maximum dollar amount for a coverage period.
Publication 969 2019, health savings accounts and other. Examples of qualified medical expenses the following list includes common examples of hsa qualified medical expenses. Health reimbursement arrangements hras p17 irs tax map. For more detailed information, please refer to irs publication 502 titled. Eligible items list on the ebsrmsco participant website.
The most surprising eligible and ineligible medical expenses. Millions of americans are now using hsas not only to pay for their immediate. A complete list is available from the irs in publication 502 medical and dental expenses by visiting. This means you should only use hsa funds for qualified medical expenses. Bandaid, curad batteries potentially will only qualify if used to operate a device that is itself a qualified expense e. It is not a complete list, is referenced here for your convenience and is subject to change without notice. If you have funds available in your hsa, you can use them to pay your eligible medical expenses. Know your hsa options your hsa gives you the opportunity to pay for eligible health care expenses now, or save your money for future expenses. This publication explains the itemized deduction for medical and dental expenses that you claim on schedule a form 1040. Your guide to understanding a health savings account.