COVID-19 Home Test Kits and PPE Eligible for Health FSA, HSA, and HRA Reimbursement

On September 10, 2021, the IRS reminded taxpayers that amounts paid for COVID-19 home test kits are eligible to be paid or reimbursed under health flexible spending arrangements (“Health FSAs”), health savings accounts (“HSAs”), health reimbursement arrangements (“HRAs”), and Archer medical savings accounts (“Archer MSAs”).  This is because the purchase of COVID-19 home test kits are deductible medical expenses under Section 213(d) of the Internal Revenue Code (the “Code”).

This guidance comes in addition to IRS Announcement 2021-7 issued earlier this year, which stated that amounts paid for personal protective equipment (“PPE”), such as masks, hand sanitizer, and sanitizing wipes are deductible medical expenses under Section 213(d) of the Code.  Thus, these amounts may also be paid or reimbursed under Health FSAs, HSAs, HRAs, and Archer MSAs.  See our previous client alert here.

As a result, Health FSAs and HRAs that permit the reimbursement of all eligible medical expenses under Section 213(d) of the Code may reimburse expenses for COVID-19 home test kits and PPE.  In addition, these amounts may be paid or reimbursed under HSAs and Archer MSAs.  If you have any questions, please contact the authors or one of the other Miller Johnson employee benefits attorneys.