use HSA to pay kids' health insurance premiums?


R

rachelms79

I have a health savings account (HSA) under a high-deductible health
insurance plan from my employer that now covers myself, my wife and
children. If I choose to drop my kids from the employer plan to switch
them to a state-sponsored kids plan (which has better benefits for lower
cost), can I use my HSA to pay the premiums for my kids'
state-sponsored plan, just as I use the HSA to pay the kids' medical
bills now? The IRS publication 969 seems to contradict itself on this
topic; it says:

"Qualified medical expenses are those expenses that would generally
qualify for the medical and dental expenses deduction. These are
explained in Publication 502, Medical and Dental Expenses."

and Pub 502 says:

"You can include in medical expenses insurance premiums you pay for
policies that cover medical care. Medical care policies can provide
payment for treatment that includes: Hospitalization, surgical
services, X-rays, etc.

which seems to say that I can use the HSA to pay the kids' premiums,
just like any other medical expense.

But Pub 969 explicitly says:

"Insurance premiums. You cannot treat insurance premiums as qualified
medical expenses unless the premiums are for:

1. Long-term care insurance.
2. Health care continuation coverage (such as coverage under COBRA).
3. Health care coverage while receiving unemployment compensation
under federal or state law.
4. Medicare and other health care coverage if you were 65 or older
(other than premiums for a Medicare supplemental policy, such as
Medigap)."

Is this last quote from Pub 969 referring only to premiums I pay for
myself, so premiums for my kids would still be allowed?

Thanks.
 
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D

D. Stussy

wrote in message I have a health savings account (HSA) under a high-deductible health
insurance plan from my employer that now covers myself, my wife and
children. If I choose to drop my kids from the employer plan to switch
them to a state-sponsored kids plan (which has better benefits for lower
cost), can I use my HSA to pay the premiums for my kids'
state-sponsored plan, just as I use the HSA to pay the kids' medical
bills now? The IRS publication 969 seems to contradict itself on this
topic; it says:

"Qualified medical expenses are those expenses that would generally
qualify for the medical and dental expenses deduction. These are
explained in Publication 502, Medical and Dental Expenses."

and Pub 502 says:

"You can include in medical expenses insurance premiums you pay for
policies that cover medical care. Medical care policies can provide
payment for treatment that includes: Hospitalization, surgical
services, X-rays, etc.

which seems to say that I can use the HSA to pay the kids' premiums,
just like any other medical expense.

But Pub 969 explicitly says:

"Insurance premiums. You cannot treat insurance premiums as qualified
medical expenses unless the premiums are for:

1. Long-term care insurance.
2. Health care continuation coverage (such as coverage under COBRA).
3. Health care coverage while receiving unemployment compensation
under federal or state law.
4. Medicare and other health care coverage if you were 65 or older
(other than premiums for a Medicare supplemental policy, such as
Medigap)."

Is this last quote from Pub 969 referring only to premiums I pay for
myself, so premiums for my kids would still be allowed?
====================

Paying health insurance premiums from an HSA are restricted to the cases above.

However, the publication is wrong when it comes to Medicare premiums. If one
is on Medicare due to disability, there is no age limit specified in the law.
 
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A

Alan

I have a health savings account (HSA) under a high-deductible health

insurance plan from my employer that now covers myself, my wife and

children. If I choose to drop my kids from the employer plan to switch

them to a state-sponsored kids plan (which has better benefits for lower

cost), can I use my HSA to pay the premiums for my kids'

state-sponsored plan, just as I use the HSA to pay the kids' medical

bills now? The IRS publication 969 seems to contradict itself on this

topic; it says:



"Qualified medical expenses are those expenses that would generally

qualify for the medical and dental expenses deduction. These are

explained in Publication 502, Medical and Dental Expenses."



and Pub 502 says:



"You can include in medical expenses insurance premiums you pay for

policies that cover medical care. Medical care policies can provide

payment for treatment that includes: Hospitalization, surgical

services, X-rays, etc.



which seems to say that I can use the HSA to pay the kids' premiums,

just like any other medical expense.



But Pub 969 explicitly says:



"Insurance premiums. You cannot treat insurance premiums as qualified

medical expenses unless the premiums are for:



1. Long-term care insurance.

2. Health care continuation coverage (such as coverage under COBRA).

3. Health care coverage while receiving unemployment compensation

under federal or state law.

4. Medicare and other health care coverage if you were 65 or older

(other than premiums for a Medicare supplemental policy, such as

Medigap)."



Is this last quote from Pub 969 referring only to premiums I pay for

myself, so premiums for my kids would still be allowed?
No. Health insurance premiums are not qualified expenses unless you can find an exception (such as the list you found in Pub 969). There is no exception for health insurance premiums for your children.
 

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