A Chief Counsel Advisory (CCA) was recently issued by the IRS’s Office of Chief Counsel to an IRS area office attorney. The conclusion of this CCA is that:
- An account holder’s interest in an HSA is subject to an IRS levy under Code Section 6331, and
- The account holder will be liable for the 10% additional excise tax on nonmedical HSA distribution unless (at the time of the levy), the holder was 65 years of age or holder or was disabled (as defined in Code Section 72(m)(7)).
Click here to read a copy of Chief Counsel Advice 200927019, 2009 WL 1894726 (May 1, 2009)].