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IRS reminder for COVID‑19 tests and PPE

COVID-19 home testing kits and certain PPE are eligible medical expenses.

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On September 10, 2021, the Internal Revenue Service (IRS) issued a reminder, IR-2021-181, that COVID-19 home testing kits are eligible for reimbursement under health care flexible spending arrangements (health care FSAs), health savings accounts (HSAs), health reimbursement arrangements (HRAs) and Archer medical savings accounts (Archer MSAs).

With COVID-19 cases on the rise in many communities, the IRS also reminded taxpayers that personal protective equipment (PPE) used for the purpose of preventing the spread of COVID-19 are eligible medical expenses reimbursable under FSAs, HSAs, HRAs, or Archer MSAs, including:

  • Masks
  • Hand sanitizer
  • Sanitizing wipes

For more information about eligible PPE items, see this related news article or refer to IRS announcement 2021-7.

COVID-19 home testing kits and other items used to prevent the spread of COVID-19 are available on the Optum Store.

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Health savings accounts (HSAs) are offered or administered by Optum Bank®, Member FDIC, or ConnectYourCare, LLC, each a subsidiary of Optum Financial. HSAs are subject to eligibility requirements and restrictions on deposits and withdrawals to avoid IRS penalties. State taxes may apply. Fees may reduce earnings on account. Flexible spending accounts/arrangements (FSAs), health reimbursement arrangements (HRAs), Commuter and Parking Benefits, Adoption Reimbursement Plans, Tuitions Reimbursement Plans, Surrogacy Reimbursement Plans, Lifestyle Plans, COBRA Benefits, and all other account types are administered on behalf of your plan sponsor by Optum Financial, Inc. or ConnectYourCare, LLC (collectively, “Optum Financial”) and are subject to eligibility and restrictions. Please contact a legal or tax professional for advice on eligibility, tax treatment, and restrictions. Please contact your plan administrator with questions about enrollment or plan restrictions. Federal and state laws and regulations and the design of your plan are subject to change.

Self-directed mutual fund investment options are made available through the services of an independent investment advisor, or your plan sponsor. Discretionary advisory services are provided by Betterment LLC, an SEC-registered investment adviser, with associated brokerage transactions provided by Betterment Securities, member FINRA/SIPC. For details and disclosures visit betterment.com. Certain brokerage services are offered through TD Ameritrade, Inc., member FDIC/SIPC and a subsidiary of The Charles Schwab Corporation.  For details and disclosures, visit  www.tdameritrade.com. The Schwab Health Savings Brokerage Account is offered through Charles Schwab & Co., Inc., member FINRA/SIPC. For details and disclosures, visit schwab.com.

Orders are accepted to effect transactions in securities only as an accommodation to HSA owners. Optum Financial and its subsidiaries are not broker-dealers or registered investment advisors and do not provide investment advice or research concerning securities, make recommendations concerning securities, or otherwise solicit securities transactions.

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