IRS guidelines for Health Savings Accounts.(HSAs)(Internal Revenue Service)(Brief Article)

Kiplinger Tax Letter, The, July, 2004

Health Savings Accounts get a big boost from the Revenue Service.

Confusion in several areas has been cleared up in new guidance, and most of the changes made are favorable to employers and employees:

Employee assistance plans. Benefits under these special programs can be considered preventive care. Thus, the minimum deductibles for HSAs of $2,000 for family coverage and $1,000 for self-only do not apply here. The same goes for wellness programs and disease management programs.

Prescription drugs. After 2005, the cost of prescription drugs is subject to the deductible. But drugs for preventive care are covered without regard to the HSA deductible. This includes medications taken to lower cholesterol and drugs that fight the recurrence of...

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