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H.R. 6306 - To amend the Internal Revenue Code of 1986 to increase the contribution limitation for health savings accounts, and for other purposes.

Sponsor: Erik Paulsen (R)
Introduced: 2018-07-03
Bill Status: Placed on the Union Calendar, Calendar No. 656.
 

Health Care Security Act of 2018

This bill amends the Internal Revenue Code to modify the rules for health savings accounts (HSAs) with respect to contribution limits, catch-up contributions for married couples, and medical expenses incurred before an HSA is established.

The bill increases the maximum contribution limits for HSAs to equal the maximum for the sum of the annual deductible and out-of-pocket expenses that may be required to be paid for covered benefits under a high deductible health plan.

If both spouses of a married couple have family coverage under a high deductible health plan, each spouse may make catch-up contributions to the same HSA. (Catch-up contributions are additional contributions which individuals who are at least 55 years of age may make to an HSA.)

If an HSA is established within 60 days of the beginning of coverage under a high deductible health plan, any distribution from the HSA used to pay a qualified medical expense incurred during that 60-day period after the health coverage began is excludible from gross income. (Under current law, the medical expense must be incurred on or after the date that the HSA is established.)

Full Text


115th CONGRESS
2d Session
H. R. 6306


    To amend the Internal Revenue Code of 1986 to increase the contribution limitation for health savings accounts, and for other purposes.


IN THE HOUSE OF REPRESENTATIVES

July 3, 2018

    Mr. Paulsen introduced the following bill; which was referred to the Committee on Ways and Means


A BILL

    To amend the Internal Revenue Code of 1986 to increase the contribution limitation for health savings accounts, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Maximum contribution limit to health savings account increased to amount of deductible and out-of-pocket limitation.

(a) Self-Only coverage.—Section 223(b)(2)(A) of the Internal Revenue Code of 1986 is amended by striking “$2,250” and inserting “the amount in effect under subsection (c)(2)(A)(ii)(I)”.

(b) Family coverage.—Section 223(b)(2)(B) of such Code is amended by striking “$4,500” and inserting “the amount in effect under subsection (c)(2)(A)(ii)(II)”.

(c) Conforming amendments.—Section 223(g)(1) of such Code is amended—

(1) by striking “subsections (b)(2) and” both places it appears and inserting “subsection”, and

(2) in subparagraph (B), by striking “determined by” and all that follows through “ ‘calendar year 2003’.” and inserting “determined by substituting ‘calendar year 2003’ for ‘calendar year 2016’ in subparagraph (A)(ii) thereof.”.

(d) Effective date.—The amendments made by this section shall apply to taxable years beginning after December 31, 2018.

SEC. 2. Allow both spouses to make catch-up contributions to the same health savings account.

(a) In general.—Section 223(b)(5) of the Internal Revenue Code of 1986 is amended to read as follows:

“(5) SPECIAL RULE FOR MARRIED INDIVIDUALS WITH FAMILY COVERAGE.—

“(A) IN GENERAL.—In the case of individuals who are married to each other, if both spouses are eligible individuals and either spouse has family coverage under a high deductible health plan as of the first day of any month—

“(i) the limitation under paragraph (1) shall be applied by not taking into account any other high deductible health plan coverage of either spouse (and if such spouses both have family coverage under separate high deductible health plans, only one such coverage shall be taken into account),

“(ii) such limitation (after application of clause (i)) shall be reduced by the aggregate amount paid to Archer MSAs of such spouses for the taxable year, and

“(iii) such limitation (after application of clauses (i) and (ii)) shall be divided equally between such spouses unless they agree on a different division.

“(B) TREATMENT OF ADDITIONAL CONTRIBUTION AMOUNTS.—If both spouses referred to in subparagraph (A) have attained age 55 before the close of the taxable year, the limitation referred to in subparagraph (A)(iii) which is subject to division between the spouses shall include the additional contribution amounts determined under paragraph (3) for both spouses. In any other case, any additional contribution amount determined under paragraph (3) shall not be taken into account under subparagraph (A)(iii) and shall not be subject to division between the spouses.”.

(b) Effective date.—The amendment made by this section shall apply to taxable years beginning after December 31, 2018.

SEC. 3. Special rule for certain medical expenses incurred before establishment of health savings account.

(a) In general.—Section 223(d)(2) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

“(D) TREATMENT OF CERTAIN MEDICAL EXPENSES INCURRED BEFORE ESTABLISHMENT OF ACCOUNT.—If a health savings account is established during the 60-day period beginning on the date that coverage of the account beneficiary under a high deductible health plan begins, then, solely for purposes of determining whether an amount paid is used for a qualified medical expense, such account shall be treated as having been established on the date that such coverage begins.”.

(b) Effective date.—The amendment made by this subsection shall apply with respect to coverage beginning after December 31, 2018.


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