The passage of HR 3590 really should have little impact on HSAs, but here are two changes that you should be aware of:
- It will exclude the tax free reimbursement for the costs for over-the-counter drugs not prescribed by a doctor effective January 1, 2011.
- It will increase the tax on distributions that are not used for qualified medical expenses to 20% from 10%. This will be effective January 1, 2011.
Source: Eric Johnson, First Horizon Msaver
