Miss. Code Ann. tit. 83, ch. 62 — Health Savings Accounts | Mississippi Code Annotated — Mississippi

Miss. Code Ann. § 83-62-1 Short title.

This chapter shall be known and may be cited as the “Health Savings Accounts Act.”

Miss. Code Ann. § 83-62-3 Definitions.

As used in this chapter: “Eligible individual” means the individual taxpayer, including employees of an employer who contributes to health savings accounts on the employees’ behalf, who: Is covered by a high deductible health plan individually or with his or her dependents as defined in this chapter; Is not covered under any health plan that is not a high deductible health plan, except for coverage for accidents, disability, dental care, vision care, long-term care, workers’ compensation insurance, insurance for a specified disease or illness, insurance paying a fixed amount per day per hospitalization and coverage for tort liabilities or liabilities relating to ownership or use of property; and Establishes, or on whose behalf is established, a health savings account. “Deductible” means the total deductible for an eligible individual and all the dependents of that eligible individual for a calendar year. “Dependent” means the spouse or child of the eligible individual as defined in Section 152 of the Internal Revenue Code subject to any additional modifications imposed by Section 223(d) (2) of the Internal Revenue Code. “Qualified medical expense” means an expense paid by the taxpayer for medical care described in Section 213(d) of the Internal Revenue Code. “High deductible health plan” means a health plan with: In the case of self-only coverage, an annual deductible which is not less than One Thousand Dollars ($1,000.00) and the sum of the annual deductible and other annual out-of-pocket expenses required to be paid under the plan for covered benefits does not exceed Five Thousand One Hundred Dollars ($5,100.00). In the case of family coverage, an annual deductible of not less than Two Thousand Dollars ($2,000.00) and the sum of the annual deductible and other annual out-of-pocket expenses required to be paid under the plan for covered benefits does not exceed Ten Thousand Two Hundred Dollars ($10,200.00). The minimum annual deductible amounts and maximum annual out-of-pocket expense limits may be adjusted each year according to a cost-of-living adjustment as determined under Section 223(g) of the Internal Revenue Code. A plan shall not fail to be treated as a high deductible health plan by reason of failing to have a deductible for preventive care, or in the case of network plans, for having limits for out-of-pocket expenses or annual deductibles for services provided outside the network that exceed the limitations in this section. “Health savings account” or “account” means a trust or custodian established in this state pursuant to a health savings account program exclusively to pay the qualified medical expenses of an eligible individual or his or her dependents, but only if the written governing instrument creating the account meets the following requirements: Except in the case of a rollover contribution, no contribution will be accepted unless it is in cash; or, to the extent such contribution, when added to the previous contributions to the account for the calendar year, exceeds one hundred percent (100%) of the eligible individual’s deductible or Two Thousand Six Hundred Fifty Dollars ($2,650.00) for an individual or Five Thousand Two Hundred Fifty Dollars ($5,250.00) per family, whichever is lower; The trustee or custodian is a bank, an insurance company or another person approved by the United States Department of Treasury and the Commissioner of Insurance; No part of the trust assets will be invested in life insurance contracts; The assets of the account will not be commingled with other property except as allowed for under Individual Retirement Accounts; and The eligible individual’s interest in the account is nonforfeitable. The maximum dollar amounts in this paragraph may be adjusted each year according to a cost-of-living adjustment as determined under Section 223(g) of the Internal Revenue Code. Eligible individuals who have attained age fifty-five (55) before the end of the year may make additional catch-up contributions into the account in the amount determined in accordance with the following table: 2005. . . . .$ 600.00 2006. . . . .$ 700.00 2007. . . . .$ 800.00 2008. . . . .$ 900.00 2009 and thereafter. . . . .$1,000.00 “Health savings account program” or “program” means a program that includes all of the following: The purchase by an eligible individual or by an employer of a high deductible health plan; and The contribution into a health savings account by or on behalf of an eligible individual or on behalf of an employee by his or her employer. The total annual contribution may not exceed the amount of the plan’s higher deductible or the amounts listed herein.

Miss. Code Ann. § 83-62-5 Contributions to health savings account; exemption from taxable gross income.

For taxable years beginning after January 1, 2005, contributions may be made into a health savings account by or on behalf of a resident of Mississippi pursuant to Section 83-62-3(f). Except as provided in Section 83-62-9, or except as otherwise provided by law, the principal contributed to and the interest earned on a health savings account and money reimbursed to an eligible individual or an employee for qualified medical expenses shall be excluded from the taxable gross income of the account holder under Section 27-7-15.

Miss. Code Ann. § 83-62-7 Purposes for which trustee may utilize funds.

The trustee or custodian shall utilize the funds held in a health savings account solely for the purpose of: Paying the qualified medical expenses of the eligible individual or his or her dependents; Purchasing a health coverage policy certificate, or contract, for an eligible individual who is receiving unemployment compensation, is exercising continuation privileges under federal law or is purchasing a long-term care insurance contract; or Paying for health insurance other than a Medicare supplemental policy for those who are Medicare eligible. Funds held in a health savings account shall not be used to cover expenses of the eligible individual or his or her dependents that are otherwise covered, including, but not limited to, medical expense covered pursuant to an automobile insurance policy, workers’ compensation insurance policy or self-insured plan or another employer-funded health coverage policy, certificate or contract.

Miss. Code Ann. § 83-62-9 Withdrawal of money; disbursement of account assets pursuant to a filing for protection under Bankruptcy Code; transfer of interest in account to spouse under divorce or separation agreement; distribution upon death of eligible individual; transfer upon change of employment.

Notwithstanding subsection (3), (4), (5) or (6) of this section, an eligible individual may withdraw money from his or her health savings account for any purpose other than a purpose described in Section 83-62-7. Subject to subsection (3) of this section, if the eligible individual withdraws money for any purpose other than a purpose described in Section 83-62-7 at any other time, all of the following apply: The amount of the withdrawal is considered taxable gross income of the account holder under Section 27-7-15 in the tax year of the withdrawal. Interest earned on the account during the tax year in which a withdrawal under this subsection is made is considered taxable gross income of the account holder under Section 27-7-15. The amount of disbursement of any assets of a health savings account pursuant to a filing for protection under Title 11 of the United States Code, 11 USCS 101 et seq., by an eligible individual or person for whose benefit the account was established is not considered a withdrawal for purposes of this section. The amount of a disbursement is not considered taxable gross income of the account holder under Section 27-7-15 and subsection (2) of this section does not apply. The transfer of an eligible individual’s interest in a health savings account to an eligible individual’s spouse or former spouse under a divorce or separation instrument shall not be considered a taxable transfer made by such eligible individual, and such interest shall, after such transfer, be treated as a health savings account with respect to which such spouse is the eligible individual. Upon the death of the eligible individual, the trustee or custodian shall distribute the principal and accumulated interest of the health savings account to the estate of the deceased. If an employee becomes employed with a different employer that participates in a health savings account program, the employee may transfer his or her health savings account to that new employer’s trustee or custodian or to an individually purchased account program.