You can use HSA plans for many different expenses, but not all of them are tax deductible.
The Internal Revenue Service recently updated guidance on what expenses are considered tax deductible when using a health savings account or other similar plans.
The IRS generally allows deductions for medical expenses, such as doctor’s appointments and prescriptions. So where is the line between alleviating an illness versus general health? People go to the gym to curb obesity. Over-the-counter medicines can be used to treat a plethora of illnesses. SEE MORE: Risks of uninsured people, plus the future of taxes
The cost of a gym membership can be included in a tax-deductible HSA “if the membership was purchased for the sole purpose of affecting a structure or function of the body or the sole purpose of treating a specific disease diagnosed by a physician ,” the IRS said. “Otherwise, the cost of a gym membership is for the general health of the individual and is not a medical expense.”Over-the-counter medicines are a bit trickier. In general, only insulin can be considered tax deductible.
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