Kiplinger's Personal FinanceAugust 2020
AS THE COUNTRY DEALT WITH THE FALLOUT from the coronavirus pandemic this spring, lawmakers and regulators scrambled to ease the pain of record job losses and other blows to Americans’ pocketbooks and health. One result that has largely flown under the radar: Health savings accounts and flexible spending accounts, which offer a tax-advantaged way to save money for certain medical or dependent-care expenses, have become more generous. Some of the changes are temporary, but others have no expiration.
More expenses are covered. Thanks to the Coronavirus Aid, Relief and Economic Security (CARES) Act, you can use money from an HSA or a health care FSA to pay more expenses—and these changes are permanent. Over-the-counter drugs purchased January 1, 2020, or later are now HSA- and FSA-eligible without a prescription. Those include pain relievers, cough suppressants, antihistamines and other drugs that treat issues from heartburn to acne, says Shobin Uralil, cofounder and chief operating officer of Lively, an HSA provider. Feminine-hygiene products such as tampons, pads and menstrual cups are also qualifying expenses under the law.
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