Starting on January 1st, 2011 Health Savings Accounts may no longer be used for over the counter medications with a doctor’s prescription. The doctor must also reside in the state where the medicine or drugs are purchased. This change takes place on January 1st, 2011 for all new and existing Health Savings Accounts.
Also, penalties for money removed from a Health Savings Account for Non HSA Qualified Expenses will increase from 10% to 20% starting in the 2011 tax year.
