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1.
Earnings on health savings account funds that are invested are _______.
Tax-free. Tax-free earnings on investments is one of the three tax advantages of HSAs.
2.
Fees associated with HSA accounts may be paid tax-free with HSA funds.
True. HSA account fees may be paid tax-free with HSA funds or paid separately with other funds.
3.
An individual may establish more than one health savings account in their own name.
True. There is no limit on the number of HSA accounts you can have. However, total contributions to all your HSA accounts cannot exceed the contribution limit for the year.
4.
When a health savings account holder dies, the account funds become taxable as income on the individual's final tax return and taxable to the beneficiary of the account unless the designated beneficiary is _______.
A surviving spouse. Only a surviving spouse, if designated the beneficiary of your account, can receive the HSA account and funds tax-free.
5.
Funds in your health savings account are not taxed when you die if your surviving spouse is named the beneficiary of the account.
True. Your spouse is the only person that can receive your HSA account and funds tax-free, but only if they are named the beneficiary of your account.