Health and Medical-Related Tax Changes
Health and Medical-Related Tax Changes
Health and Medical-Related Tax Changes
Archer Medical Savings Account (MSAs)
For 2010 & 2011, the minimum annual deductible, maximum annual deductible, and the maximum annual deductible, and the maximum out-of-pocket expenses limit have increased.
2010 Changes
Higher Deductible Health Plan (HDHP). For Archer MSA purposes, the minimum annual deductible for an HDHP is $2,000 ($4,050 for family coverage) and the maximum annual deductible is $3,000 ($6,050 for family coverage).
Maximum out-of-pocket expenses. The maximum out-of-pocket expenses limit for Archer MSAs is $4,050 ($7,400 for family coverage).
2011 Changes
High Deductible Health Plan (HDHP). For Archer MSA purposes, the minimum annual deductible for an HDHP increases to $2,050 ($4,100 for family coverage) and the maximum annual deductible increases to $3,050 ($6,150 for family coverage).
Maximum out-of-pocket expenses. The maximum out-of-pocket expenses limit for Archer MSAs increases to $4,100 ($7,500 for family coverage).
Nonprescription medicines no longer qualify. For tax years beginning after December 31, 2010, nonprescription medicines (other than insulin) no longer qualify as an expense for Archer MSA purposes unless they are prescribed.
Health Flexible Spending Arrangements
A special rule allows amounts in a health FSA to be distributed to reservists ordered or called to active duty.
Qualified reservists distribution from a health FSA. A special rule allows amounts in a health FSA to be distributed to reservists ordered or called to active duty. This rule applies to distributions after June 17, 2008, if the plan has been amended to allow these distributions. A qualified reservist distribution is allowed if:
The individual was, by reason of being a member of a reserve component, ordered or called to active duty for a period in excess of 179 days or for an indefinite period
The distribution is made during the period beginning on the date of such order or call and ending on the last date that reimbursements could be made for the plan year which includes the date of such order or call.
Health Savings Accounts (HSAs)
2010
High Deductible Health Plan (HDHP). The minimum annual deductible of an HDHP increases to $1,200 ($2,499 for family coverage) and the maximum annual deductible and other out-of-pocket expenses limit increases to $5,950 ($11,900 for family coverage).
Limits on contributions. The maximum Health Savings Account contribution increases to $3,050 ($6,150 for family coverage).
2011
Nonprescription medicines no longer qualify. For tax years beginning after December 31, 2010, nonprescription medicines (other than insulin) do not qualify as an expense for health savings account purposes unless they are prescribed.
Long-Term Care Premiums
Increase in Deductible Limit for Long-Term Care Premiums. For 2010, the maximum amount of qualified long-term care premiums, up to the amounts shown below, as medical expenses on Form 1040.
Age 40 or under - $330
Age 41 to 50 - $620
Age 51 to 60 - $1,230
Age 61 to 70 - $3,290
Age 71 or over - $4,110
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