Vision Payroll

April 23, 2014

Tip of the Week: IRS Releases 2015 Inflation Adjustments for Health Savings Accounts

IRS Releases 2015 Inflation Adjustments for Health Savings Accounts

IRS Releases 2015 Inflation Adjustments for Health Savings Accounts

The Internal Revenue Service recently released Rev. Proc. 2014-30 which contained the 2015 inflation adjusted amounts for Health Savings Accounts or HSAs.

Deductions Limitation Set to Increase

The annual limitation on deductions will increase from $3,300 in 2014 to $3,350 in 2015 for those with self-only coverage. Those with family coverage will have the deduction limitation increase from $6,550 to $6,650.

High-Deductible Health Plan Minimum Deductibles to Increase

The minimum deductibles of a high deductible health plan will increase from a minimum deductible of $1,250 in 2014 to $1,300 in 2015 for self-only coverage, and from $2,500 in 2014 to $2,600 in 2015 for family coverage.

Annual Out-of-Pocket Limitation to Increase

The annual out-of-pocket limitation for 2015 will also increase from $6,350 in 2014 to $6,450 for those with self-only coverage; the out-of-pocket limitation for family coverage will increase from $12,700 in 2014 to $12,900 in 2015.

Contact Vision Payroll Today

Contact Vision Payroll if you have any questions on the updated 2015 inflation adjusted amounts for HSAs in Rev. Proc. 2014-30 or visit our Important Facts and Figures page for further information.

May 17, 2011

IRS Releases 2012 Inflation Adjustments for Health Savings Accounts

IRS Releases 2012 Inflation Adjustments for Health Savings Accounts
IRS Releases 2012 Inflation Adjustments for Health Savings Accounts
The Internal Revenue Service recently released Rev. Proc. 2011-32 which contained the 2012 inflation adjusted amounts for Health Savings Accounts or HSAs.

Deductions Limitation Set to Increase

The annual limitation on deductions will increase from $3,050 in 2011 to $3,100 in 2012 for those with self-only coverage. Those with family coverage will have the deduction limitation increase from $6,150 to $6,250.

High-Deductible Health Plan Minimum Deductibles Unchanged

The minimum deductibles of a high deductible health plan will see no change; they will remain at a minimum deductible of $1,200 in 2012 for self-only coverage and $2,400 for family coverage.

Annual Out-of-Pocket Limitation to Increase

The annual out-of-pocket limitation for 2012 will also increase from $5,950 in 2011 to $6,050 for those with self-only coverage; the out-of-pocket limitation for family coverage will increase from $11,900 to $12,100.

Contact Vision Payroll Today

Contact Vision Payroll if you have any questions on the updated 2012 inflation adjusted amounts for HSAs in Rev. Proc. 2011-32 or visit our Important Facts and Figures page for further information.

February 27, 2011

IRS Announces Lactation Expenses Qualify as Deductible Medical Expenses

IRS Announces Lactation Expenses Qualify as Deductible Medical Expenses
IRS Announces Lactation Expenses Qualify as Deductible Medical Expenses
In Announcement 2011-14, the Internal Revenue Service (IRS) “has concluded that breast pumps and supplies that assist lactation are medical care under § 213(d) of the Internal Revenue Code because, like obstetric care, they are for the purpose of affecting a structure or function of the body of the lactating woman.” Therefore, assuming all other requirements are met, these expenses qualify as deductible medical expenses.

Reimbursement Allowed Under Flexible Spending Arrangements

Since these amounts qualify as deductible medical expenses, reimbursements of “these expenses under flexible spending arrangements [FSAs], Archer medical savings accounts, health reimbursement arrangements, or health savings accounts are not income to the taxpayer.”

Publication 502 to Be Revised

The IRS will revise Publication 502, Medical and Dental Expenses, to include this information

Contact Vision Payroll for Further Information

Contact Vision Payroll if you have any questions on Announcement 2011-14.

September 3, 2010

Question of the Week: How Does Health Care Reform Affect Reimbursements for Over-the Counter Medicines in FSAs?

Over-the-Counter Medicines Generally Are No Longer Reimbursable
Over-the-Counter Medicines Generally Are No Longer Reimbursable
This week’s question comes from Eric, an HR manager. I know there are changes to flexible spending arrangements (FSAs) because of health care reform. How does health care reform affect reimbursements for over-the-counter medicines in FSAs? Answer: The Patient Protection and Affordable Care Act (PPACA) made changes to reimbursements for over-the-counter medicines in the following types of accounts:

  • Flexible Spending Arrangements (FSAs),
  • Health Reimbursement Arrangements (HRAs),
  • Health Savings Accounts (HSAs), and
  • Archer Medical Savings Accounts (Archer MSAs).

Over-the-Counter Medicines Generally Are No Longer Reimbursable

Generally, the cost of an over-the-counter medicine or drug cannot be reimbursed from the account unless a prescription is obtained. The change does not affect insulin, even if purchased without a prescription, or other health care expenses such as medical devices, eyeglasses, contact lenses, co-pays and deductibles.

Change Is Effective for 2011

The new standard applies only to purchases made on or after Jan. 1, 2011, so claims for medicines or drugs purchased without a prescription in 2010 can still be reimbursed in 2011, if allowed by the employer’s plan.

IRS Provides Guidance on New Rules

The Internal Revenue Service (IRS) recently released Notice 2010-59 to provide guidance to employers and employees on the impact of PPACA and how it revises the definition of medical expenses as it relates to over-the-counter drugs.

Rev. Rul. 2003-102 Obsoleted

In conjunction with this change, the IRS also released Rev. Rul. 2010-23, which obsoletes Rev. Rul. 2003-102. This ruling provided guidance on employer reimbursements of amounts paid by an employee to purchase nonprescription medicines or drugs.

Employees Need to Plan for Changes When Making 2011 Elections

Vision Payroll recommends employees start to plan now to account for the impact of these changes on how they will make their elections under these types of plans.

May 25, 2010

IRS Releases 2011 Inflation Adjustments for Health Savings Accounts

The Internal Revenue Service (IRS) recently released Rev. Proc. 2010-22, which contained the 2011 inflation adjusted amounts for Health Savings Accounts or HSAs. Since the changes in the Consumer Price Index for the relevant period do not result in changes to the amounts in 2011, the amounts will stay the same as in 2010.

The annual limitation on deductions will remain at $3,050 in 2011 for those with self-only coverage. Those with family coverage will have the deduction limitation stay at $6,150.

The definition of a high deductible health plan will see no change from one with a minimum deductible of $1,200 in 2011 for self-only coverage and $2,400 for family coverage.

The annual out-of-pocket limitation for 2011 also will not increase from $5,950 for those with self-only coverage; the out-of-pocket limitation for family coverage remains at $11,900.

Contact Vision Payroll if you have any questions on Rev. Proc. 2010-22 and the amounts for HSAs in 2011.

May 15, 2009

Question of the Week: What Are the 2010 Health Savings Account Inflation Adjustments?

This week’s question comes from Joel, an HR director. We just implemented a Health Savings Account plan at our company. We know the amounts employees can contribute for 2009. What are the 2010 Health Savings Account inflation adjustments? Answer: the Internal Revenue Service recently released Rev. Proc. 2009-29 which contained the 2010 inflation adjusted amounts for Health Savings Accounts or HSAs.

The annual limitation on deductions will increase from $3,000 in 2009 to $3,050 in 2010 for those with self-only coverage. Those with family coverage will have the deduction limitation increase from $5,950 to $6,150.

The definition of a high deductible health plan will change from one with a minimum deductible of $1,150 in 2009 to $1,200 in 2010 for self-only coverage and from $2,300 to $2,400 for family coverage.

The annual out-of-pocket limitation for 2010 will also increase from $5,800 in 2009 to $5,950 for those with self-only coverage; the out-of-pocket limitation for family coverage will increase from $11,600 to $11,900.

Contact Vision Payroll if you have any questions on Rev. Proc. 2009-29 and the changes to HSAs for 2010.

September 17, 2008

Tip of the Week: HSAs Can Provide Tax Savings and Cost Reduction

The Treasury Department and the Small Business Administration recently announced a new website to provide information on how a Health Savings Account (HSA) can help businesses meet their employees’ health insurance needs. The new website gives an overview of HSAs, their advantages and disadvantages, a FAQ section, a comparison among different types of plans, and resources for more information. It will also be updated on a regular basis with news and official information concerning HSAs. President Bush recently participated in a roundtable discussion on HSAs with small business leaders in Oklahoma City. Vision Payroll can work with you and your benefits broker to determine if an HSA is right for you and, if so, to ensure that your HSA is properly established. Vision Payroll will also ensure that your deductions are properly calculated and reported for federal and state tax purposes. Don’t wait to be the last business on your block with an HSA—contact Vision Payroll today to get started.

July 12, 2008

IRS Issues Guidance on Health Savings Accounts

Filed under: News — Tags: , , , , , — Vision @ 1:46 pm

The IRS recently issued Notice 2008-59 on Health Savings Accounts (HSA), which are available to taxpayers enrolled in a High Deductible Health Plan. Qualified contributions to an HSA are not subject to federal income tax and distributions from an HSA for qualified medical expenses may also be made tax-free. The guidance is in the form of 42 questions and answers and the topics covered are: Eligible Individuals, High Deductible Health Plans, Contributions, Distributions, Prohibited Transactions, Establishing an HSA, and Administration. Vision Payroll can work with you and your benefits broker to determine if an HSA is right for you and, if so, to ensure that your HSA is properly established. Vision Payroll will also ensure that your deductions are properly calculated and reported for federal and state tax purposes. An HSA can be a cost-effective alternative to traditional health plans—shouldn’t you find out more today?

Contact Us Vision Payroll
Client Remote Access