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Bill

HR 2436

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.

119th Congress Introduced by Mike Carey and 9 co-sponsors

HR 2436 allows families to use up to $5,000 from Health Savings Accounts for funeral expenses without tax penalties, easing financial burdens during tough times.

Introduced in House
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Bill Summary · HR 2436

Summary of HR 2436: Health Savings Accounts and Funeral Expenses

Bill Number: HR 2436
Introduced: March 27, 2025
Status: Introduced in House
Primary Sponsor: Kevin Hern
Cosponsors: Derek Schmidt, Daniel Meuser, Mike Carey

Purpose and Intent

HR 2436 aims to amend the Internal Revenue Code of 1986 to allow distributions from Health Savings Accounts (HSAs) to be used for funeral expenses of the account beneficiary. The bill seeks to provide financial relief to families during a difficult time by enabling them to utilize HSA funds for funeral-related costs without incurring tax penalties.

Key Provisions

The bill includes several significant amendments to the Internal Revenue Code:

  1. Definition of Funeral Expenses:

    • The bill expands the definition of qualified distributions from HSAs to include funeral expenses. This encompasses a wide range of costs associated with the care and disposition of the remains of the deceased, including:
      • Burial, cremation, embalming, interment, or inurnment
      • Preparation of remains for burial or cremation
      • Clothing for the remains
      • Casket or urn
      • Hearse service
      • Funeral director’s services
      • Venue fees for the funeral
      • Transportation of remains
      • Grave digging and grave liner
      • Grave plot

  2. Limit on Funeral Expenses:

    • The total amount that can be treated as funeral expenses per account beneficiary is capped at $5,000.

  3. Timing of Expense Recognition:

    • For a 90-day period following the death of the account beneficiary, funeral expenses will be treated as if they were incurred immediately before the beneficiary's death. This provision allows families to access HSA funds more flexibly during a time of need.

  4. Effective Date:

    • The amendments will apply to amounts paid after the enactment of the bill, specifically in taxable years ending after that date.

Impact

The proposed changes will primarily affect individuals who have Health Savings Accounts and their beneficiaries. Families facing the loss of a loved one will benefit from the ability to use HSA funds for funeral expenses without facing tax penalties. This legislation aims to ease the financial burden associated with funeral costs, which can be significant.

Legislative Process

  • March 27, 2025: The bill was introduced and referred to the House Committee on Ways and Means for further consideration.

This summary provides a clear overview of HR 2436, detailing its purpose, key provisions, and potential impact on families and individuals utilizing Health Savings Accounts.

Compiled from official sources — confirm details with the bill’s official record.

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