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Hi,
Your parent's were correct. Generally FMV of HSA becomes taxable income to non spouse beneficiary. But it can be reduce by medical expenses paid within one year. Please remember that only expenses that were incurred after HSA account was open can be claimed.
Thanks for participating in TurboTax's Ask the Expert event today. I hope this information was helpful!
‎September 25, 2024
10:11 AM