Instructions For Form Msa - Montana Medical Care Savings Account Worksheet (Page 2 of 4) in pdf

Instructions For Form Msa - Montana Medical Care Savings Account Worksheet Page 2

I paid several eligible medical bills from my regular

checking account in 2016. Can I reimburse myself for

these amounts from my Montana medical care savings

account? If I can, how soon do I have to withdraw

funds from my Montana medical care savings account

and deposit them in my checking account?

You can reimburse yourself from the medical savings

account for eligible medical expenses you paid, even if

the expenses were incurred before you established the

account. You have until December 31, 2016 to withdraw

funds from your Montana medical care savings account to

reimburse yourself for funds withdrawn from your checking

account. However, if the eligible medical expenses were

paid after December 1, 2016, you have until January 15,

2017 to withdraw funds to reimburse yourself.

I have a Montana medical care savings account. I

withdrew funds during 2016 that were not used for

eligible medical expenses. Are there any penalties that

I have to pay because of this withdrawal?

When you withdraw funds from your Montana medical care

savings account for some purpose other than payment

of eligible medical expenses, you incur a 10% penalty on

these withdrawals, unless you withdraw them on the last

business day of your tax year. You will need to complete

Part II of this form to calculate your penalty.

In all cases, your nonqualified withdrawals are considered

ordinary income in the year that you withdraw the funds

and are included as an addition to federal adjusted gross

income in calculating your Montana adjusted gross income.

What records do I have to maintain to verify that my

withdrawals from my Montana medical care savings

account were used for eligible medical expenses?

You will need to maintain documentation that proves that

your withdrawals in 2016 were used to pay (either as a

reimbursement or a direct payment) for eligible medical

expenses in 2016 for yourself, your spouse and your

eligible dependents.

Administrative Rules of Montana: 42.15.601 through

42.15.605

Questions? Please call us toll free at (866) 859-2254 (in

Helena, 444-6900), or access the Montana State University

Extension MontGuide at

msu_montguides.html.

Instructions For Form Msa - Montana Medical Care Savings Account Worksheet Page 2