For instructions on how to make changes to your HSA beneficiary elections, refer to:

• HSA – Add or Remove Beneficiaries

For instructions on how to make changes to your retirement plan beneficiary elections, refer to:

• Retirement – Change Online Beneficiaries

For instructions on how to make changes to your HSA beneficiary elections, refer to HSA – Add or Remove Beneficiaries

For instructions on how to make changes to your retirement plan beneficiary elections, refer to Retirement – Change Online Beneficiaries

If you have a dependent care FSA, refer to Dependent Care Flexible Spending Accounts for more information about the plan options.

For instructions on how to make changes to your HSA beneficiary elections, refer HSA – Add or Remove Beneficiaries

For instructions on how to make changes to your retirement plan beneficiary elections, refer to Retirement – Change Online Beneficiaries

To review information on how a divorce can affect your retirement plan, refer to Post Divorce Critical Actions and Understanding QDRO

HSA owners designate a beneficiary at the time it is established. If the beneficiary is a spouse, the HSA becomes the spouse’s HSA. If the beneficiary is not a spouse, the HSA ceases to be an HSA and the value of the HSA becomes taxable to the designated beneficiary.

Rollover

When a spouse is the surviving primary beneficiary of a retirement account, they can choose to roll the account into a new inherited IRA account or inherited IRA annuity. This will allow all tax-deferred income earned to continue being deferred until the surviving spouse withdraws.

You should not roll over an inherited retirement account into your own IRA if you are under age 59½. This will be treated as a regular distribution and taxed with the 10% early withdrawal penalty.

Leave the Account

A surviving spouse can continue to manage the inherited account as the account owner. They can defer withdrawals or withdraw from the account and are exempt from the IRS early withdrawal penalty if the surviving spouse is younger than 59½ at the time of death. However, if the deceased was 70½ or older, the surviving spouse must take the required minimum distributions (RMDs) from the inherited account.

At death, FSA contributions stop. Up until the claims filing deadline mandated by the plan, dependents can still file eligible expenses incurred by the owner before death. Only the owner’s expenses or those of their dependents are eligible to be claimed, and only for the expenses incurred before death. Seek additional assistance from an estate planning professional.

HSA – If you become disabled, your HSA account is still active, and can continue paying for qualifying medical expenses (including payments for Medicare Part A and Part B). Any distributions you make for non-qualified medical expenses may not be subject to the 20% penalty and will continue to be tax-free.

Retirement – You can take withdrawals from your account without penalty if you meet the IRS definition of total disability. To qualify, you must be unable to engage in any substantial gainful activity because of your disability. Also, a doctor must confirm your disability will last at least a year.

FSA – Expenses for a disabled person, such as a wheelchair, Braille books and magazines, a guide dog, and special medical care, are eligible for reimbursement in a flexible spending account

Capital expenditures refer to a variety of home improvements and equipment that may be medically necessary for homeowners to live comfortably in their own homes.

Some examples include elevators, ramps, expanded doorways, and wheelchair lifts. Under current IRS regulations, these improvements fall under the status of products necessary to treat a legitimate medical condition. These expenses must be for the diagnosis, cure, mitigation, treatment, or prevention of disease, or to affect any structure or function of the body. If these expenses are permanent improvements that increase the value of the home, the excess value is not reimbursable to the account holder.