HR2436FEDERALin_committee

Proposed Tax Change for Using Health Savings Accounts (HSA) for Funeral Costs

Original title: To amend the Internal Revenue Code of 1986 to treat distributions from health savings accounts for funeral expenses of the account beneficiary as qualified distributions.

March 27, 2025

taxes health savings accounts funeral expenses estate planning

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Where This Stands

Introduced

Committee

Floor Vote

Passed

Signed

Currently in_committee. The next step in the legislative lifecycle is Floor Vote.

Last action

Referred to the House Committee on Ways and Means.Mar 27, 2025

Version history

Only one version on file - nothing to compare yet. As later stages (committee substitute, engrossed, enrolled) are captured, the redline appears here.

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The Frame

What this does

If passed, this bill would allow HSA holders to use up to $5,000 of their tax-advantaged savings to cover their own funeral or burial costs, which are currently not considered qualified medical expenses.

Who is mentioned in the record

Potentially affected actors named in the source documents. Mention is not a position.

HSA account holders

Account holders gain the ability to use up to $5,000 of their HSA funds for their own funeral expenses without tax penalties.

Internal Revenue Service

The agency would be required to update tax regulations to include funeral expenses as qualified HSA distributions.

What changed

Current stage: in_committee.

What's next

Floor Vote.

Summary

This bill would allow individuals to use money from their Health Savings Accounts (HSA) to pay for funeral expenses of the account holder without incurring tax penalties. It sets a $5,000 limit on the amount that can be used for these purposes.

Key Facts

The bill amends the Internal Revenue Code to classify funeral expenses as 'qualified distributions' from Health Savings Accounts (HSAs).
The total amount of HSA funds that can be used for funeral expenses is capped at $5,000 per account beneficiary.
Defined funeral expenses include burial, cremation, embalming, interment, inurnment, preparation of remains, clothing, casket or urn, hearse services, funeral director services, venue fees, transportation, grave digging, grave liners, and grave plots.
Funeral expenses incurred within 90 days after the death of the account beneficiary will be treated as if they were incurred immediately before death.
The changes apply to amounts paid after the date of the bill's enactment for taxable years ending after that date.

Frequently Asked Questions

Can I use my HSA to pay for a family member's funeral?

No, the bill specifically defines these expenses as those paid for the care and disposition of the remains of the '' themselves.

Is there a limit on how much I can spend from my HSA for funeral costs?

Yes, the bill limits the aggregate amount treated as funeral expenses to $5,000.

When does this change take effect?

The provisions apply to amounts paid after the date the bill is signed into law.

Why It Matters

News Coverage

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Discoveries

Patterns POLISCOPE noticed across the record. These are observations to investigate, not conclusions.

policy shift90% confidence

Expansion of HSA Utility

This bill represents a shift in policy by expanding the definition of 'qualified medical expenses' to include post-mortem funeral costs, which are typically excluded from medical-related tax exemptions.

Internal Revenue Code of 1986

Connected Entities

organizationCommittee on Ways and Means“The House committee to which the bill was referred.”Map →

personKevin Hern“U.S. Representative from Oklahoma who introduced the bill.”Map →

Analysis Score

0–100

Significance40
How much this matters to a regular citizen
Controversy10
Intensity of disagreement among stakeholders
Entertainment5
Compellingness for a non-policy-wonk reader
Buzz15
Current news / social attention level

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