1. The maximum qualified HSA funding distributions depends on the HDHP coverage (self-oly or family) you have on the first day of the month in which the contribution is made and your age as of the end of the year. The distributions must be made directly by the trustee of the IRA to the trustee of the HSA. The distribution
A. Is not included in your income.
B.
Is not deductible.
C.
Reduces the amount that can be contributed to your HSA.
D. All of the above.
2. Report all contributions to your HSA on Form 8889 and file it with your Form 1040. You will have excess contributions if the contributions to your HSA for the year are greater than the limits. Excess contributions
A. Are not deductible.
B.
Made by your employer are included in your income.
C.
Not included in box 1 of Form W-2 must be reported as "Other income" on your tax
return.
D. All of the above.
3. You may withdraw some or all of the excess contributions and avoid the excise tax on the amount withdrawn if you withdraw the excess contributions by the due date of your tax return for tax year contributions were made and
A.
You don't withdraw any of the earnings from the contribution.
B.
You withdraw any income earned on the withdrawn contributions and include the
earnings in "Other income" on your tax return for the year you withdraw the
contributions and earnings.
C.
You opt to not remain an eligible individual during any of the testing periods.
D.
All of the above.
4. You may be able to deduct excess contributions for previous years that are still in your HSA. The excess contribution you can deduct for the current year is
A.
Your maximu HSA contribution limit for the year minus any amount contributed to
your HSA for the year.
B.
The total excess contributions in your HSA at the beginning of the year.
C.
The lesser of the A and B above.
D. Your maximum HSA contribution limit for the year plus the total excess
contributions in your HSA at the beginnig of the year.
5. You will generally pay medical expenses during the year without being reimbursed by your HDHP until you reach the annual deductible for the plan. You can receive tax-free distributions from you HSA to pay
A.
For qualified medical expenses you incur before you establish the HSA.
B.
For non-prescription medicines (other than insulin).
C. For any expenses that generally don't qualify for the medical and dental
expense deductions such as enhancement plastic surgery.
D.
All of the above.
6. You can deduct the tax-free distribution to pay for medical expenses as qualified medical expenses as an itemized deduction on Schedule A (Form 1040).
True False
7. In regards to distributions from HSAs used to pay qualified medical expenses, you must keep records sufficient to show that
A.
The distributions were exclusively to pay or reimburse qualified medical
expenses.
B.
The qualified medical expenses had not been previously paid or reimbursed from
another source.
C.
The medical expenses had not been taken as an itemized deduction in any year.
D.
Any of the above.
8. You must pay tax on the distribution and report the amount on Form 8889 and file it with your Form 1040 (or Form 1040NR) if
A.
You use a distribution from your HSA for qualified medical expenses.
B.
You do not use a distribution from your HSA for qualified medical expenses.
C.
You incurred HSA administration and maintenance fees withdrawn by the trustee.
D.
Any of the above.
9. You as an employer can make contributions to your employees' HSAs. You deduct the contributions on the "Employee benefit programs" line of your business income tax return for
A.
The year in which you make the contributions.
B. The year for which you make the contributions.
C.
The year for which you made the contribution if the contribution is allocated to
a prior year.
D.
None of the above.
10. Amounts you contribute to your employees' HSAs are
A. Generally, subject to employment taxes.
B. Generally, subject to a 35% excise tax on the amount contributed.
C. Generally, not subject to employment taxes.
D.
The same percentage of the annual deductible limit under the HDHP covering the
employees.
11. An Archer MSA is a tax-exempt trust or custodial account that you set up with a U.S. financial institution in which you can save money exclusively for future medical expenses. With an Archer MSA,
A.
You can only claim a tax deduction for contributions you make if you itemize
your deductions on Form 1040 or Form 1040NR.
B.
The interest or other earnings on the assets in your Archer MSA are taxable only
upon distribution.
C.
You can change employers or leave the work force and the "portable" MSA stays
with you.
D.
None of the above.
12. To qualify for an Archer MSA, you must be
A. An employee (or the spouse of an employee) of a small employer that maintains
a self-only or family HDHP for you (or your spouse).
B. A self-employed person (or the spouse of a self-employed person) who
maintains a self-only or family HDHP.
C. Either A or B above.
D. Have other health coverage that is not an HDHP to complement your MSA plan.
13. If you change employers, your Archer MSA moves with you and you can make additional contributions because your eligibility was determined with the first employer.
True False
14. Who can contribute to your Archer MSA plan?
A. If your employer does not make contributions to your Archer MSA, or you are
self-employed, you can make your own contributions to your Archer MSA.
B. You have to make contributions to your Archer MSA plan every year.
C. If you are an employee, both you and your employer can make contributions to
your Archer MSA in the same year.
D.
If you are an employee, only your employer can contribute to your account.
15. There is a 15% additional tax on the part of your distributions not used for qualified medical expenses. This tax applies to
A. HSAs.
B. Archer MSAs.
C. Health FSAs.
D. HRAs.
16. This arrangement allows employees to be reimbursed for medical expenses and are usually funded through voluntary salary reduction agreements with your employer.
A.
HSA.
B.
Archer MSA.
C. Health FSA.
D.
HRA.
17. To participate in a health FSA you do not have to be covered under any other health care plan and you have to be an employee or a self-employed person.
True False
18. You do not pay federal income tax or employment taxes on the salary you contribute or the amounts your employer contributes to the heath FSA.
True False
19. The following is a benefit from having an HRA.
A. Contributions made by your employer can be excluded from your gross income.
B.
Reimbursements may be tax free if you pay qualified medical expenses.
C. Any unused amounts in the HRA can be carried forward for reimbursements in
later years.
D.
All of the
above.
20. This arrangement is designated by Medicare to be used solely to pay the qualified medical expenses of the account holder who is enrolled in Medicare.
A.
Medicare Advantage MSA.
B.
Medicare Advantage FSA.
C.
Medicare Advantage HSA.
D.
Medicare Advantage HDHP.