Some Medical Travel Qualifies for Tax-free HSA Distributions
By William G. Stuart | Originally posted on LinkedIn for Health Savings Academy
This column is an excerpt (Question 99) from a book to be published later this year to help guide account owners, employers, benefits managers, and administrators understand Health Savings Account compliance issues. The format consists of a common question, an explanation in easy-to-understand English (often with an appropriate example), and citation from government documents to support the answer. The book is designed to inform. It is not a legal document, and the contents should not be construed as legal advice.
Question: I’m traveling with my young son for his care in another state. Can I reimburse our travel expenses tax-free from my Health Savings Account?
Answer: Yes. You can reimburse certain travel expenses tax-free from your Health Savings Account if the primary purpose of the trip is to receive medical care. These expenses include:
Transportation costs in your vehicle (at a rate of 21¢ per mile in 2024), an ambulance, or a common carrier (like an airplane, bus, taxi, or train).
Tolls and parking fees.
Lodging of up to $50 per night for the patient and an additional $50 nightly for one caregiver (like you, the parent) if the presence of an additional person is necessary.
You can’t reimburse the price of meals, transportation, or lodging for anyone other than the patient and a single caregiver, or any other incidental expenses.
You can reimburse the qualified expenses tax-free, even if the care is available closer to home.
Expenses that don’t qualify include a patient’s cost of commuting to and from work (even if the patient requires a specially equipped and more expensive means of transportation, such as a handicapped-accessible van), travel for personal reasons when the medical care is only incidental, and self-prescribed services to improve your general health (such as a ride in a rented convertible in the fresh spring air of northern Vermont to reduce stress).