Internal Revenue Service United States Department of the Treasury
Level Basic Advanced Military International

Health Savings Accounts (HSA)

Types of Tax-Favored Arrangements

Check Your Knowledge

Question 2 of 2

Which of the following statements is false?

Taxpayers' contributions to an HSA are tax deductible.
Interest earned on an HSA is tax-free if used for unreimbursed qualified medical expenses.
Taxpayers pay taxes on HSA earnings when they take distributions for unreimbursed qualified medical expenses.
Unused funds and interest are carried over, without limit, from year to year.