On March 31, Congressman Kevin Hearn (R-OK-01) introduced H.R. 2436, The Funeral Coverage Act that would allow funeral and burial expenses to be paid from a Health Savings Account (HSA) of the deceased. This will allow families that have saved money for healthcare expenses to use those funds for funeral and burial costs after the person dies and no longer needs the money for healthcare expenses.
When a person sets up an HSA, they name a beneficiary. If the beneficiary is a surviving spouse, the unused portion of the decedent’s HSA passes directly to the spouse and is added to his or her HSA and incurs no tax liability.
If the immediate need for the spouse is to pay for a funeral and burial, rather than have additional funds automatically added to their own HSA, this bill would enable surviving spouses to take care of their most immediate need: paying for a funeral and burial.
However, if medical expenses are owed at the time of death, the funds in the HSA will be used to pay those medical expenses before funeral expenses are paid. ICCFA supports this legislation and is advocating for its passage.
