With all the discussion of the Bush Era, now Obama, Tax Cuts, there has been little attention paid to the tax changes that will start in 2011 due to Health Care Reform: HSAs, Archer MSAs, FSAs, and health reimbursement will no longer cover over-the-counter drugs. These accounts must conform to the definition of the itemized deduction for medical expenses (excluding over-the-counter medicines prescribed by a physician). The penalty for HSAs and Archer MSA’s funds used for unqualified medical expenses will increase from 10% to 20%. Annual fees will be imposed on manufacturers and importers of branded drugs. Here for more information on all the tax changes associated with the Health Care Reform Bill.
