Here's another useful "Idaho MSA 101" type of topic, and it's a question we get frequently. "Who can use the funds in my Idaho MSA?" or put another way, "Who's healthcare expenses can I pay for out of my Idaho MSA?".
Great question, and it's one we get a lot surrounding children, parents and spouses. The good news is that the Idaho MSA's flexibility really shines here, and you can use the funds within it to pay for the healthcare needs of a lot of different people in your family in addition to yourself.
Here's our full analysis:
Can I Pay for My Spouse?
Yes! You can use the funds in your Idaho MSA tax-free to pay for eligible medical expenses for your spouse. There are no restrictions or requirements outside of what expenses are considered eligible under the standard rules.
Can I Pay for My Kids?
Yes, to a certain extent. As long as your children are either 21 years or younger, and/or full-time college students, you can pay for the healthcare expenses of your children tax-free.
It is important to note here, that you do not have to claim your kids as dependents on your tax returns in order to pay for their medical expenses from your Idaho MSA. We get typically get this question in relation to divorce, where one parent claims the child or children as dependents and the other cannot. The Idaho MSA does not draw this line.
Can I Pay for My Parents?
No, unfortunately you cannot use the funds in your Idaho MSA to pay for the healthcare expenses of your parents.
Can I Pay for Friends/Neighbors/Co-Workers/Anybody Else?
No, unfortunately you cannot use the funds in your Idaho MSA to pay for the healthcare expenses of anyone other than yourself, your spouse and your children that fit the guidelines.
That should pretty much cover most demographics, but if we left anyone out please let us know and we'll add them in! We hope you enjoyed this post and found it both helpful and informative. As a reference, all of this information can be found in Idaho House Bill 595, which is the governing document from the State of Idaho relating to the Idaho Medical Savings Account rules/regulations.
Lastly, if you ever have any questions about the Idaho MSA as a current or future accountholder, please don't hesitate to ask and we will be glad to help you. That's exactly what we're here for!