In the case of an individual who is an eligible individual for any month during the taxable year, there shall be allowed as a deduction for the taxable year an amount equal to the aggregate amount paid in cash during such taxable year by or on behalf of such individual to a health savings account of such individual.
The amount allowable as a deduction under subsection (a) to an individual for the taxable year shall not exceed the sum of the monthly limitations for months during such taxable year that the individual is an eligible individual.
The monthly limitation for any month is 1/12 of-
In the case of an individual who has attained age 55 before the close of the taxable year, the applicable limitation under subparagraphs (A) and (B) of paragraph (2) shall be increased by the additional contribution amount.
For purposes of this section, the additional contribution amount is the amount determined in accordance with the following table:
For taxable years beginning in: | The additional contribution amount is: |
2004 | $500 |
2005 | $600 |
2006 | $700 |
2007 | $800 |
2008 | $900 |
2009 and thereafter | $1,000. |
The limitation which would (but for this paragraph) apply under this subsection to an individual for any taxable year shall be reduced (but not below zero) by the sum of-
Subparagraph (A) shall not apply with respect to any individual to whom paragraph (5) applies.
In the case of individuals who are married to each other, if either spouse has family coverage-
No deduction shall be allowed under this section to any individual with respect to whom a deduction under section 151 is allowable to another taxpayer for a taxable year beginning in the calendar year in which such individual's taxable year begins.
The limitation under this subsection for any month with respect to an individual shall be zero for the first month such individual is entitled to benefits under title XVIII of the Social Security Act and for each month thereafter.
For purposes of computing the limitation under paragraph (1) for any taxable year, an individual who is an eligible individual during the last month of such taxable year shall be treated-
If, at any time during the testing period, the individual is not an eligible individual, then-
Subclauses (I) and (II) of clause (i) shall not apply if the individual ceased to be an eligible individual by reason of the death of the individual or the individual becoming disabled (within the meaning of section 72(m)(7)).
The term "testing period" means the period beginning with the last month of the taxable year referred to in subparagraph (A) and ending on the last day of the 12th month following such month.
For purposes of this section-
The term "eligible individual" means, with respect to any month, any individual if-
Subparagraph (A)(ii) shall be applied without regard to-
An individual shall not fail to be treated as an eligible individual for any period merely because the individual receives hospital care or medical services under any law administered by the Secretary of Veterans Affairs for a service-connected disability (within the meaning of section 101(16) of title 38, United States Code).
An individual shall not fail to be treated as an eligible individual for any period merely because the individual receives benefits for medical care subject to and in accordance with section 9816 or 9817, section 2799A-1 or 2799A-2 of the Public Health Service Act, or section 716 or 717 of the Employee Retirement Income Security Act of 1974, or any State law providing similar protections to such individual.
The term "high deductible health plan" means a health plan-
Such term does not include a health plan if substantially all of its coverage is coverage described in paragraph (1)(B).
A plan shall not fail to be treated as a high deductible health plan by reason of failing to have a deductible for preventive care (within the meaning of section 1861 of the Social Security Act, except as otherwise provided by the Secretary).
In the case of a plan using a network of providers-
Such plan shall not fail to be treated as a high deductible health plan by reason of having an out-of-pocket limitation for services provided outside of such network which exceeds the applicable limitation under subparagraph (A)(ii).
Such plan's annual deductible for services provided outside of such network shall not be taken into account for purposes of subsection (b)(2).
In the case of-
a plan shall not fail to be treated as a high deductible health plan by reason of failing to have a deductible for telehealth and other remote care services.
A plan shall not fail to be treated as a high deductible health plan by reason of providing benefits for medical care in accordance with section 9816 or 9817, section 2799A-1 or 2799A-2 of the Public Health Service Act, or section 716 or 717 of the Employee Retirement Income Security Act of 1974, or any State law providing similar protections to individuals, prior to the satisfaction of the deductible under paragraph (2)(A)(i).
A plan shall not fail to be treated as a high deductible health plan by reason of failing to have a deductible for selected insulin products.
For purposes of this subparagraph-
The term "selected insulin products" means any dosage form (such as vial, pump, or inhaler dosage forms) of any different type (such as rapid-acting, short-acting, intermediate-acting, long-acting, ultra long-acting, and premixed) of insulin.
The term "insulin" means insulin that is licensed under subsection (a) or (k) of section 351 of the Public Health Service Act (42 U.S.C. 262) and continues to be marketed under such section, including any insulin product that has been deemed to be licensed under section 351(a) of such Act pursuant to section 7002(e)(4) of the Biologics Price Competition and Innovation Act of 2009 (Public Law 111-148) and continues to be marketed pursuant to such licensure.
The term "permitted insurance" means-
The term "family coverage" means any coverage other than self-only coverage.
The term "Archer MSA" has the meaning given such term in section 220(d).
For purposes of this section-
The term "health savings account" means a trust created or organized in the United States as a health savings account exclusively for the purpose of paying the qualified medical expenses of the account beneficiary, but only if the written governing instrument creating the trust meets the following requirements:
The term "qualified medical expenses" means, with respect to an account beneficiary, amounts paid by such beneficiary for medical care (as defined in section 213(d)) for such individual, the spouse of such individual, and any dependent (as defined in section 152, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B) thereof) of such individual, but only to the extent such amounts are not compensated for by insurance or otherwise. For purposes of this subparagraph, amounts paid for menstrual care products shall be treated as paid for medical care.
Subparagraph (A) shall not apply to any payment for insurance.
Subparagraph (B) shall not apply to any expense for coverage under-
For purposes of this paragraph, the term "menstrual care product" means a tampon, pad, liner, cup, sponge, or similar product used by individuals with respect to menstruation or other genital-tract secretions.
The term "account beneficiary" means the individual on whose behalf the health savings account was established.
Rules similar to the following rules shall apply for purposes of this section:
A health savings account is exempt from taxation under this subtitle unless such account has ceased to be a health savings account. Notwithstanding the preceding sentence, any such account is subject to the taxes imposed by section 511 (relating to imposition of tax on unrelated business income of charitable, etc. organizations).
Rules similar to the rules of paragraphs (2) and (4) of section 408(e) shall apply to health savings accounts, and any amount treated as distributed under such rules shall be treated as not used to pay qualified medical expenses.
Any amount paid or distributed out of a health savings account which is used exclusively to pay qualified medical expenses of any account beneficiary shall not be includible in gross income.
Any amount paid or distributed out of a health savings account which is not used exclusively to pay the qualified medical expenses of the account beneficiary shall be included in the gross income of such beneficiary.
If any excess contribution is contributed for a taxable year to any health savings account of an individual, paragraph (2) shall not apply to distributions from the health savings accounts of such individual (to the extent such distributions do not exceed the aggregate excess contributions to all such accounts of such individual for such year) if-
Any net income described in clause (ii) shall be included in the gross income of the individual for the taxable year in which it is received.
For purposes of subparagraph (A), the term "excess contribution" means any contribution (other than a rollover contribution described in paragraph (5) or section 220(f)(5)) which is neither excludable from gross income under section 106(d) nor deductible under this section.
The tax imposed by this chapter on the account beneficiary for any taxable year in which there is a payment or distribution from a health savings account of such beneficiary which is includible in gross income under paragraph (2) shall be increased by 20 percent of the amount which is so includible.
Subparagraph (A) shall not apply if the payment or distribution is made after the account beneficiary becomes disabled within the meaning of section 72(m)(7) or dies.
Subparagraph (A) shall not apply to any payment or distribution after the date on which the account beneficiary attains the age specified in section 1811 of the Social Security Act.
An amount is described in this paragraph as a rollover contribution if it meets the requirements of subparagraphs (A) and (B).
Paragraph (2) shall not apply to any amount paid or distributed from a health savings account to the account beneficiary to the extent the amount received is paid into a health savings account for the benefit of such beneficiary not later than the 60th day after the day on which the beneficiary receives the payment or distribution.
This paragraph shall not apply to any amount described in subparagraph (A) received by an individual from a health savings account if, at any time during the 1-year period ending on the day of such receipt, such individual received any other amount described in subparagraph (A) from a health savings account which was not includible in the individual's gross income because of the application of this paragraph.
For purposes of determining the amount of the deduction under section 213, any payment or distribution out of a health savings account for qualified medical expenses shall not be treated as an expense paid for medical care.
The transfer of an individual's interest in a health savings account to an individual's spouse or former spouse under a divorce or separation instrument described in clause (i) of section 121(d)(3)(C) shall not be considered a taxable transfer made by such individual notwithstanding any other provision of this subtitle, and such interest shall, after such transfer, be treated as a health savings account with respect to which such spouse is the account beneficiary.
If the account beneficiary's surviving spouse acquires such beneficiary's interest in a health savings account by reason of being the designated beneficiary of such account at the death of the account beneficiary, such health savings account shall be treated as if the spouse were the account beneficiary.
If, by reason of the death of the account beneficiary, any person acquires the account beneficiary's interest in a health savings account in a case to which subparagraph (A) does not apply-
The amount includible in gross income under clause (i) by any person (other than the estate) shall be reduced by the amount of qualified medical expenses which were incurred by the decedent before the date of the decedent's death and paid by such person within 1 year after such date.
An appropriate deduction shall be allowed under section 691(c) to any person (other than the decedent or the decedent's spouse) with respect to amounts included in gross income under clause (i) by such person.
Each dollar amount in subsections (b)(2) and (c)(2)(A) shall be increased by an amount equal to-
In the case of adjustments made for any taxable year beginning after 2007, section 1(f)(4) shall be applied for purposes of this paragraph by substituting "March 31" for "August 31", and the Secretary shall publish the adjusted amounts under subsections (b)(2) and (c)(2)(A) for taxable years beginning in any calendar year no later than June 1 of the preceding calendar year.
If any increase under paragraph (1) is not a multiple of $50, such increase shall be rounded to the nearest multiple of $50.
The Secretary may require-
The reports required by this subsection shall be filed at such time and in such manner and furnished to such individuals at such time and in such manner as may be required by the Secretary.
26 U.S.C. § 223
Inflation Adjusted Items for Certain Years For inflation adjustment of certain items in this section, see Revenue Procedures listed in a table below and under section 1 of this title.
EDITORIAL NOTES
REFERENCES IN TEXTThe Social Security Act, referred to in subsecs. (b)(7), (c)(2)(C), (d)(2)(C)(iv), (f)(4)(C), is act Aug. 14, 1935, ch. 531, 49 Stat. 620. Title XVIII of the Act is classified generally to subchapter XVIII (§1395 et seq.) of chapter 7 of Title 42, The Public Health and Welfare. Sections 1811, 1861, and 1882 of the Act are classified to sections 1395c, 1395x, and 1395ss, respectively, of Title 42. For complete classification of this Act to the Code, see section 1305 of Title 42 and Tables.Sections 2799A-1 and 2799A-2 of the Public Health Service Act, referred to in subsec. (c)(1)(D), (2)(F), are classified to sections 300gg-111 and 300gg-112, respectively, of Title 42, The Public Health and Welfare.Sections 716 and 717 of the Employee Retirement Income Security Act of 1974, referred to in subsec. (c)(1)(D), (2)(F), are classified to sections 1185e and 1185f, respectively, of Title 29, Labor.Section 7002(e)(4) of the Biologics Price Competition and Innovation Act of 2009, referred to in subsec. (c)(2)(G)(ii)(II), is section 7002(e)(4) of Pub. L. 111-148, which is set out in a note under section 262 of Title 42, The Public Health and Welfare.
PRIOR PROVISIONSA prior section 223 was renumbered section 224 of this title.
AMENDMENTS2022-Subsec. (c)(1)(B)(ii). Pub. L. 117-328, §4151(b), which directed the substitution of "(in the case of months or plan years to which paragraph (2)(E) applies)" for "(in the case of plan years beginning on or before December 31, 2021, or in the case of months beginning after March 31, 2022, and before January 1, 2023)", was executed by making the substitution for "(in the case of plan years beginning on or before December 31, 2021, or in the case of months beginning after March 31, 2022, and before January 1, 2023,)", to reflect the probable intent of Congress. Pub. L. 117-103, §307(b), inserted ", or in the case of months beginning after March 31, 2022, and before January 1, 2023," after "December 31, 2021".Subsec. (c)(2)(E). Pub. L. 117-328, §4151(a), substituted "In the case of-" and cls. (i) and (ii) for "In the case of plan years beginning on or before December 31, 2021, or in the case of months beginning after March 31, 2022, and before January 1, 2023,". Pub. L. 117-103, §307(a), inserted "or in the case of months beginning after March 31, 2022, and before January 1, 2023," after "December 31, 2021,".Subsec. (c)(2)(G). Pub. L. 117-169 added subpar. (G).2020-Subsec. (c)(1)(B)(ii). Pub. L. 116-136, §3701(b), substituted "long-term care, or (in the case of plan years beginning on or before December 31, 2021) telehealth and other remote care" for "or long-term care".Subsec. (c)(1)(D). Pub. L. 116-260, §102(c)(4)(A)(i), added subpar. (D).Subsec. (c)(2)(E). Pub. L. 116-136, §3701(a), added subpar. (E). Subsec. (c)(2)(F). Pub. L. 116-260, §102(c)(4)(A) (ii), added subpar. (F).Subsec. (d)(2)(A). Pub. L. 116-136, §3702(a)(1), substituted "For purposes of this subparagraph, amounts paid for menstrual care products shall be treated as paid for medical care." for "Such term shall include an amount paid for medicine or a drug only if such medicine or drug is a prescribed drug (determined without regard to whether such drug is available without a prescription) or is insulin." Subsec. (d)(2)(D). Pub. L. 116-136, §3702(a)(2), added subpar. (D).2018-Subsec. (c)(2)(C). Pub. L. 115-141, §401(a) (57), substituted "section 1861" for "section 1871". Subsec. (d)(2)(A). Pub. L. 115-141, §401(a) (58), substituted "section 213(d))" for "section 213(d)". 2017-Subsec. (f)(7). Pub. L. 115-97, §11051(b)(3)(E), substituted "clause (i) of section 121(d)(3)(C)" for "subparagraph (A) of section 71(b)(2)".Subsec. (g)(1)(B). Pub. L. 115-97, §11002(d)(1)(V), substituted "for 'calendar year 2016' in subparagraph (A)(ii)" for "for 'calendar year 1992' in subparagraph (B)" in introductory provisions.2015-Subsec. (c)(1)(C). Pub. L. 114-41 added subpar. (C).2010-Subsec. (d)(2)(A). Pub. L. 111-148, §9003(a), inserted at end "Such term shall include an amount paid for medicine or a drug only if such medicine or drug is a prescribed drug (determined without regard to whether such drug is available without a prescription) or is insulin."Subsec. (f)(4)(A). Pub. L. 111-148, §9004(a), substituted "20 percent" for "10 percent".2006-Subsec. (b)(2)(A). Pub. L. 109-432, §303(a)(1), substituted "$2,250." for "the lesser of- "(i) the annual deductible under such coverage, or "(ii) $2,250, or".Subsec. (b)(2)(B). Pub. L. 109-432, §303(a)(2), substituted "$4,500." for "the lesser of- "(i) the annual deductible under such coverage, or "(ii) $4,500."Subsec. (b)(4)(C). Pub. L. 109-432, §307(b), added subpar. (C).Subsec. (b)(8). Pub. L. 109-432, §305(a), added par. (8).Subsec. (c)(1)(B)(iii). Pub. L. 109-432, §302(b), added cl. (iii). Subsec. (d)(1)(A)(ii)(I). Pub. L. 109-432, §303(b), substituted "subsection (b)(2)(B)" for "subsection (b)(2)(B)(ii)". Subsec. (g)(1). Pub. L. 109-432, §304, inserted concluding provisions.2005-Subsec. (d)(2)(A). Pub. L. 109-135 inserted ", determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B) thereof" after "section 152".
STATUTORY NOTES AND RELATED SUBSIDIARIES
EFFECTIVE DATE OF 2022 AMENDMENT Pub. L. 117-328, div. FF, title IV, §4151(c), Dec. 29, 2022, 136 Stat. 5931, provided that: "The amendments made by this section [amending this section] shall apply to plan years beginning after December 31, 2022." Pub. L. 117-169, §11408(b), Aug. 16, 2022, 136 Stat. 1905, provided that: "The amendment made by this section [amending this section] shall apply to plan years beginning after December 31, 2022." Pub. L. 117-103, div. P, title II, §307(c), Mar. 15, 2022, 136 Stat. 807, provided that: "The amendments made by this section [amending this section] shall take effect on the date of the enactment of this Act [Mar. 15, 2022]."
EFFECTIVE DATE OF 2020 AMENDMENT Pub. L. 116-260, div. BB, title I, §102(c)(4)(B), Dec. 27, 2020, 134 Stat. 2796, provided that: "The amendments made by subparagraph (A) [amending this section] shall apply for plan years beginning on or after January 1, 2022." Pub. L. 116-136, div. A, title III, §3701(c), Mar. 27, 2020, 134 Stat. 415, provided that: "The amendments made by this section [amending this section] shall take effect on the date of the enactment of this Act [Mar. 27, 2020]."Amendment by section 3702(a) of Pub. L. 116-136 applicable to amounts paid after Dec. 31, 2019, see section 3702(d)(1) of Pub. L. 116-136, set out as a note under section 220 of this title.
EFFECTIVE DATE OF 2017 AMENDMENT Amendment by section 11002(d)(1)(V) of Pub. L. 115-97 applicable to taxable years beginning after Dec. 31, 2017, see section 11002(e) of Pub. L. 115-97, set out as a note under section 1 of this title. Amendment by section 11051(b)(3)(E) of Pub. L. 115-97 applicable to any divorce or separation instrument (as defined in former section 71(b)(2) of this title as in effect before Dec. 22, 2017) executed after Dec. 31, 2018, and to such instruments executed on or before Dec. 31, 2018, and modified after Dec. 31, 2018, if the modification expressly provides that the amendment made by section 11051 of Pub. L. 115-97 applies to such modification, see section 11051(c) of Pub. L. 115-97, set out as a note under section 61 of this title.
EFFECTIVE DATE OF 2015 AMENDMENT Pub. L. 114-41, §4007(b)(2), July 31, 2015, 129 Stat. 466, provided that: "The amendment made by this subsection [amending this section] shall apply to months beginning after December 31, 2015."
EFFECTIVE DATE OF 2010 AMENDMENT Amendment by section 9003(a) of Pub. L. 111-148 applicable to amounts paid with respect to taxable years beginning after Dec. 31, 2010, see section 9003(d)(1) of Pub. L. 111-148, set out as a note under section 220 of this title.Amendment by section 9004(a) of Pub. L. 111-148 applicable to distributions made after Dec. 31, 2010, see section 9004(c) of Pub. L. 111-148, set out as a note under section 220 of this title.
EFFECTIVE DATE OF 2006 AMENDMENT Pub. L. 109-432, div. A, title III, §302(c)(2), Dec. 20, 2006, 120 Stat. 2949, provided that: "The amendment made by subsection (b) [amending this section] shall take effect on the date of the enactment of this Act [Dec. 20, 2006]." Pub. L. 109-432, div. A, title III, §303(c), Dec. 20, 2006, 120 Stat. 2950, provided that: "The amendments made by this section [amending this section] shall apply to taxable years beginning after December 31, 2006." Pub. L. 109-432, div. A, title III, §305(b), Dec. 20, 2006, 120 Stat. 2951, provided that: "The amendments made by this section [amending this section] shall apply to taxable years beginning after December 31, 2006." Pub. L. 109-432, div. A, title III, §307(c), Dec. 20, 2006, 120 Stat. 2953, provided that: "The amendments made by this section [amending this section and section 408 of this title] shall apply to taxable years beginning after December 31, 2006."
EFFECTIVE DATE OF 2005 AMENDMENT Amendment by Pub. L. 109-135 effective as if included in the provisions of the Working Families Tax Relief Act of 2004, Pub. L. 108-311, to which such amendment relates, see section 404(d) of Pub. L. 109-135, set out as a note under section 21 of this title.
EFFECTIVE DATESection applicable to taxable years beginning after Dec. 31, 2003, see section 1201(k) of Pub. L. 108-173, set out as an Effective Date of 2003 Amendment note under section 62 of this title.
INFLATION ADJUSTED ITEMS FOR CERTAIN YEARS Provisions relating to inflation adjustment of items in this section for certain years were contained in the following: 2023-Revenue Procedure 2022-24. 2022-Revenue Procedure 2021-25. 2021-Revenue Procedure 2020-32. 2020-Revenue Procedure 2019-25. 2019-Revenue Procedure 2018-30. 2018-Revenue Procedure 2017-37. 2017-Revenue Procedure 2016-28. 2016-Revenue Procedure 2015-30. 2015-Revenue Procedure 2014-30. 2014-Revenue Procedure 2013-25. 2013-Revenue Procedure 2012-26. 2012-Revenue Procedure 2011-32. 2011-Revenue Procedure 2010-22. 2010-Revenue Procedure 2009-29. 2009-Revenue Procedure 2008-29. 2008-Revenue Procedure 2007-36.
- Secretary
- The term "Secretary" means the Secretary of the Treasury or his delegate.
- State
- The term "State" shall be construed to include the District of Columbia, where such construction is necessary to carry out provisions of this title.
- person
- The term "person" shall be construed to mean and include an individual, a trust, estate, partnership, association, company or corporation.
- taxable year
- The term "taxable year" means the calendar year, or the fiscal year ending during such calendar year, upon the basis of which the taxable income is computed under subtitle A. "Taxable year" means, in the case of a return made for a fractional part of a year under the provisions of subtitle A or under regulations prescribed by the Secretary, the period for which such return is made.
- taxpayer
- The term "taxpayer" means any person subject to any internal revenue tax.