Publication 969 - Introductory Material
This is archived information that pertains only to the 2006 Tax Year. If you
are looking for information for the current tax year, go to the Tax Prep Help Area.
Health savings accounts. The following new rules apply to health savings accounts for 2007. For details on these changes, see Publication 553, Highlights
of 2006 Tax
Changes.
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You may be able to request your employer make a one-time transfer of the balance in your FSA or HRA to your HSA.
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Your contributions to your HSA are no longer limited to your annual health plan deductible.
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If you are an eligible individual during the last month of your tax year, you are treated as being an eligible individual
for the entire tax
year for purposes of computing the amount you can contribute to your HSA.
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You can exclude from your gross income a qualified HSA funding distribution from your individual retirement account.
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If you are not a highly compensated employee, your employer does not have to take into account a highly compensated employee
in determining
who is a comparable participating employee.
Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of
missing children
selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children
home by looking at the
photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.
Various programs are designed to give individuals tax advantages to offset health care costs. This publication explains the
following programs.
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Health savings accounts (HSAs).
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Medical savings accounts (Archer MSAs and Medicare Advantage MSAs).
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Health flexible spending arrangements (FSAs).
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Health reimbursement arrangements (HRAs).
An HSA may receive contributions from an eligible individual or any other person, including an employer or a family member,
on behalf of an
eligible individual. Contributions, other than employer contributions, are deductible on the eligible individual's return
whether or not the
individual itemizes deductions. Employer contributions are not included in income. Distributions from an HSA that are used
to pay qualified medical
expenses are not taxed.
An Archer MSA may receive contributions from an eligible individual and his or her employer, but not both in the same year.
Contributions by the
individual are deductible whether or not the individual itemizes deductions. Employer contributions are not included in income.
Distributions from an
MSA that are used to pay qualified medical expenses are not taxed.
A Medicare Advantage MSA is an Archer MSA designated by Medicare to be used solely to pay the qualified medical expenses of
the account holder who
is eligible for Medicare. No Medicare Advantage MSAs have been established as of the revision date of this publication.
A health FSA may receive contributions from an eligible individual. Employers may also contribute. Contributions are not includible
in income.
Reimbursements from an FSA that are used to pay qualified medical expenses are not taxed.
An HRA must receive contributions from the employer only. Employees may not contribute. Contributions are not includible in
income. Reimbursements
from an HRA that are used to pay qualified medical expenses are not taxed.
Comments and suggestions.
We welcome your comments about this publication and your suggestions for future editions.
You can write to us at the following address:
Internal Revenue Service
Individual Forms and Publications Branch
SE:W:CAR:MP:T:I
1111 Constitution Ave. NW, IR-6406
Washington, DC 20224
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including the area code, in
your correspondence.
You can email us at
*taxforms@irs.gov. (The asterisk must be included in the
address.) Please put “
Publications Comment” on the subject line. Although we cannot respond individually to each email, we do appreciate your
feedback and will consider your comments as we revise our tax products.
Ordering forms and publications.
Visit
www.irs.gov/formspubs to download forms and publications, call 1-800-829-3676, or write to the address below and receive a response
within 10 business days after your request is received.
National Distribution Center
P.O. Box 8903
Bloomington, IL 61702-8903
Tax questions.
If you have a tax question, visit
www.irs.gov or call 1-800-829-1040. We cannot answer tax questions sent to
either of the above addresses.
