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This bill would change tax rules so that money from certain health care savings accounts and reimbursements can no longer be used tax-free for most abortions. It says abortions generally would not count as qualified medical expenses in health savings accounts, Archer medical savings accounts, flexible spending accounts, health reimbursement arrangements, and certain retiree health accounts. The bill keeps an exception for abortions in cases of rape or incest, or when a doctor certifies that the pregnant person faces a danger of death because of a physical condition related to the pregnancy. The new rules would start for expenses or payments made after December 31, 2025.
- Most abortion-related expenses would not be treated as qualified medical expenses for tax-free health account use.
- The bill applies to several types of accounts, including HSAs, Archer MSAs, FSAs, HRAs, and some retiree health accounts.
- Exceptions would remain for pregnancies resulting from rape or incest, and for cases where a physician says the abortion is needed to prevent death.
- The changes would generally take effect for amounts paid in tax years beginning after December 31, 2025, with the reimbursement rule applying to expenses incurred after that date.
Official Summaries
Protecting Life in Health Savings Accounts Act
This bill excludes expenses paid for an abortion from qualified medical expenses eligible for reimbursement from certain tax-exempt savings accounts. (Some exceptions apply.)
Under the bill, amounts paid for an abortion, other than an excluded abortion, are not qualified medical expenses eligible for reimbursement from a health savings account, Archer medical savings account, health flexible spending arrangement, health reimbursement arrangement, or retiree health account.
The bill defines excluded abortion as any abortion (1) related to a pregnancy that is the result of rape or incest; or (2) performed because a woman is suffering from a physical disorder, injury, or illness (including a life-endangering physical condition caused by or arising from the pregnancy itself) that would, as certified by a physician, place the woman in danger of death if an abortion were not performed.
Current Full Text
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 251 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 251
To amend the Internal Revenue Code of 1986 to prohibit treatment of
certain distributions and reimbursements for certain abortions as
qualified medical expenses.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
January 24, 2025
Mr. Lee (for himself, Mr. Banks, Mr. Daines, Mrs. Hyde-Smith, Mr.
Hagerty, Mr. Cramer, Mrs. Blackburn, and Mr. Hawley) introduced the
following bill; which was read twice and referred to the Committee on
Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to prohibit treatment of
certain distributions and reimbursements for certain abortions as
qualified medical expenses.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Protecting Life in Health Savings
Accounts Act''.
SEC. 2. DISTRIBUTIONS FOR CERTAIN ABORTIONS NOT QUALIFIED.
(a) HSAs.--
(1) In general.--Subparagraph (A) of section 223(d)(2) of
the Internal Revenue Code of 1986 is amended by adding at the
end the following: ``Such term shall not include any amount
paid for an abortion (other than an excluded abortion).''.
(2) Excluded abortion.--Section 223(d)(2) of such Code is
amended by adding at the end the following new subparagraph:
``(E) Excluded abortion.--For purposes of this
paragraph, the term `excluded abortion' means any
abortion--
``(i) with respect to a pregnancy that is
the result of an act of rape or incest, or
``(ii) with respect to which the woman
suffers from a physical disorder, physical
injury, or physical illness, including a life-
endangering physical condition caused by or
arising from the pregnancy itself, that would,
as certified by a physician, place the woman in
danger of death unless the abortion is
performed.''.
(b) Archer MSAs.--Subparagraph (A) of section 220(d)(2) of the
Internal Revenue Code of 1986 is amended by adding at the end the
following: ``Such term shall not include any amount paid for an
abortion (other than an excluded abortion (as defined in section
223(d)(2)(E)).''.
(c) Health Flexible Spending Arrangements and Health Reimbursement
Arrangements.--Section 106 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new subsection:
``(h) Prohibition on Reimbursements for Abortions.--For purposes of
this section and section 105, reimbursement for expenses incurred for
an abortion (other than an excluded abortion (as defined in section
223(d)(2)(E)) shall not be treated as a reimbursement for medical
expenses.''.
(d) Retiree Health Accounts.--Section 401(h) of the Internal
Revenue Code of 1986 is amended by inserting ``(other than an expense
for an abortion (other than an excluded abortion (as defined in section
223(d)(2)(E))))'' after ``sickness, accident, hospitalization, and
medical expenses'' in the matter preceding paragraph (1).
(e) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendments made by this section shall apply to amounts paid
with respect to taxable years beginning after December 31,
2025.
(2) Reimbursements.--The amendment made by subsection (c)
shall apply to expenses incurred with respect to taxable years
beginning after December 31, 2025.
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