Page 16 - Busey 2021 Annual Benefits Enrollment
P. 16
2021
Always remember to keep your receipts! What Expenses are Eligible for
Reimbursement From an HSA?
If the IRS audits you to make sure you
used your HSA for eligible expenses, you An HSA may reimburse IRS qualiied medical expenses
will need to provide receipts in order to incurred by you, the account holder, your spouse and
avoid paying the penalty. your dependents (even if the spouse and dependent
children are not enrolled in a CDHP). Qualiied health
expenses are deined by the IRS in IRC Sec. 213(d).
In addition to qualiied health expenses, the following
insurance premiums may be reimbursed from an HSA:
COBRA premiums
Health insurance premiums while receiving
unemployment beneits
Qualiied long-term care premiums (the
reimbursable amount depends on one’s age)
Any health insurance premiums paid, other than
for a Medicare supplemental “Medigap” policy, by
individuals age 65 and over
Can Ineligible Expenses be
Reimbursed From an HSA?
Yes. Neither the trustee, bank, insurance company
nor the employer are required to determine if a claim
submitted for reimbursement is a qualifying expense.
If you are audited and are found to have withdrawn
funds from your HSA for non-qualifying health
expenses, this amount will be subject to a 20% penalty
as well as taxes. Where funds are distributed as a result
of the account beneiciary’s death, disability, or after he
or she is eligible for Medicare, the 20% penalty does not
apply.
Distributions made from an HSA to reimburse the
account beneiciary for qualiied health expenses are
excluded from gross income.
16
Always remember to keep your receipts! What Expenses are Eligible for
Reimbursement From an HSA?
If the IRS audits you to make sure you
used your HSA for eligible expenses, you An HSA may reimburse IRS qualiied medical expenses
will need to provide receipts in order to incurred by you, the account holder, your spouse and
avoid paying the penalty. your dependents (even if the spouse and dependent
children are not enrolled in a CDHP). Qualiied health
expenses are deined by the IRS in IRC Sec. 213(d).
In addition to qualiied health expenses, the following
insurance premiums may be reimbursed from an HSA:
COBRA premiums
Health insurance premiums while receiving
unemployment beneits
Qualiied long-term care premiums (the
reimbursable amount depends on one’s age)
Any health insurance premiums paid, other than
for a Medicare supplemental “Medigap” policy, by
individuals age 65 and over
Can Ineligible Expenses be
Reimbursed From an HSA?
Yes. Neither the trustee, bank, insurance company
nor the employer are required to determine if a claim
submitted for reimbursement is a qualifying expense.
If you are audited and are found to have withdrawn
funds from your HSA for non-qualifying health
expenses, this amount will be subject to a 20% penalty
as well as taxes. Where funds are distributed as a result
of the account beneiciary’s death, disability, or after he
or she is eligible for Medicare, the 20% penalty does not
apply.
Distributions made from an HSA to reimburse the
account beneiciary for qualiied health expenses are
excluded from gross income.
16
