On 3/5/18 the IRS issued Notice 2018-12, providing transition relief on the issue of male sterilization and HSA accounts. In the notice, the IRS states that:
- Male Sterilization is NOT preventative care
- Male Sterilization must include cost sharing payments such as deductibles/co-pays
- HDHP Policies that mandate payments for male sterilization without cost sharing are NOT qualified for HSA contributions.
Important notes for 2018 and 2019:
This is Transition Relief to allow states to pass legislation to fix the mandated coverage for male sterilization.
- The IRS will allow HSA contributions even if the HDHP policy is NOT qualified due to the male sterilization requirement.
- See our previous blog for additional details, Important Notice: Maryland-based employers who renewed or began health coverage 1/1/18.
- See the change to HSA contribution limits for 2018, IRS Lowers HSA Limit Due to New Tax Law.
- The Maryland legislature must still finalize efforts to correct the male sterilization mandate for HDHP policies.
- If the new bill is signed and passes before 2020, HSA contributions for 2018 and 2019 will be fully deductible and qualified.
Should you have any questions, please reach out to your FosterThomas benefits account manager or customer service representative.
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