Reminder: Cost Of Home Testing For COVID-19 Is An Eligible Medical Expense

CATEGORY: Private Education Matters
CLIENT TYPE: Private Education
DATE: Nov 05, 2021

Earlier this month, the IRS issued an announcement reminding all taxpayers that the cost of home testing for COVID-19 is an eligible medical expense that can be paid for or reimbursed under health FSAs, HSAs, HRAs, or Archer MSAs.  The IRS explained that the cost to diagnose COVID-19 is an eligible medical expense for tax purposes.  The IRS also issued a reminder that the costs of personal protective equipment (PPE) for the primary purpose of preventing the spread of COVID-19 (e.g., masks, hand sanitizer, and sanitizing wipes) are eligible medical expenses that can be paid or reimbursed under these arrangements.  Also, as a reminder, other requirements must also be followed for an expense to qualify for reimbursement under a health FSA, HSA, HRA, or Archer MSA.  For example, for an FSA or HRA, the plan document must permit the reimbursement or otherwise allow reimbursement of any expense that qualifies as a medical expense under the Internal Revenue Code and applicable regulations.

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