H.R. 5933: HSAs For Heroes Act

This legislation, known as the HSAs For Heroes Act, proposes several changes to the regulations surrounding Health Savings Accounts (HSAs) specifically aimed at helping veterans and those involved in caregiving.

Key Provisions of the Bill

1. Expanding Contribution Eligibility for HSAs

The bill amends the Internal Revenue Code to allow individuals who have served in the military to contribute to HSAs, regardless of whether they have a service-connected disability. This change will be effective for tax years starting after December 31, 2025. The definition of an eligible individual is expanded to include any military service member discharged under conditions other than dishonorable.

2. Coordination with Veterans' Benefits

The bill clarifies that the amendments made will not affect the eligibility of veterans for other benefits under the veterans' benefits program. This means that veterans can still utilize HSA funds without it interfering with their existing benefits.

3. Distributions During Qualified Caregiving

The proposed changes allow funds from HSAs to be used for qualified medical expenses or during periods of qualified caregiving without the amounts being counted as gross income. Qualified caregiving periods are defined as times when an individual is on leave due to specific caregiving situations as outlined in the Family and Medical Leave Act. This provision emphasizes support for caregivers who may be managing medical needs for themselves or others.

4. Removing High Deductible Health Plan Requirement

This bill removes the requirement that individuals need to be enrolled in a high deductible health plan (HDHP) in order to contribute to an HSA. This change aims to increase access to HSAs, potentially allowing more individuals to save for medical expenses.

5. Increasing Contribution Limits

The bill proposes to increase the maximum contribution limit for HSAs to $9,000 for individuals, which is a significant increase. For individuals filing jointly, this limit would double. This change is intended to provide individuals with enhanced opportunities to save for healthcare costs.

6. Regulatory Authority and Reporting Requirements

The Secretary of the Treasury, in conjunction with the Secretary of Veterans Affairs, will develop regulations to enforce these changes. They will also report to Congress annually on the contributions and distributions made by eligible veterans, as well as any issues encountered in the administration of these accounts.

7. Budgetary Effects

The bill requires the Treasury to estimate its revenue effects and report these estimates to Congress within six months following its enactment, ensuring transparency on how these amendments may impact federal revenue.

Relevant Companies

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