high deductible health plan

[ahclem]

I got my 2019 health insurance through the Affordable Care Act marketplace (Obamacare). When I used Turbo Tax this year, it asked me the following question:  "What type of High Deductible Health Plan did you have on 12/1/2018?" Why does Turbo Tax ask this question? I think (but I can't remember for certain) the previous question in the Turbo Tax program was something like "Did you have a Health Savings Account in 2019?" to which I answered "No". In order to complete my taxes by the filing deadline, I answered the Turbo Tax program question that I didn’t have any High Deductible Health Plan on 12/1/2018 (which was one of the options it presented) and moved on through the program from there. After I filed my taxes, I asked my insurer if I had a “High Deductible Health Plan” as defined by the IRS (an “HDHP”). They didn't know. Then since I got my health insurance through eh Affordable Care Act marketplace, I asked them the same question, and they didn't know. Finally I called the IRS (since the term “HDHP” is an IRS invention) and asked them if I had an HDHP and they said it was an irrelevant question in my specific case, since I in fact didn’t have a Health Savings Account in 2019. So why does the Turbo Tax program ask this very specific question which appears to be "out of the blue" and isn't relevant to my particular situation? It seems to be confusing things rather than helping them as far as my situation is concerned. 

[rjs]

---

@ahclem wrote:

I used Turbo Tax this year, it asked me the following question:  "What type of High Deductible Health Plan did you have on 12/1/2018?" Why does Turbo Tax ask this question?

---

TurboTax has to ask that question because of a very complicated rule called the "last-month rule." If you contributed to an HSA in 2018, and you had an HDHP on December 1, 2018, but not for the entire year, under certain circumstances you might have to report additional income on your 2019 tax return. So TurboTax for 2019 has to ask the question.

The people you spoke to at your insurance company, the Marketplace, and the IRS are apparently not familiar with the details of this complicated and somewhat obscure rule. But the insurance company certainly knows whether the policy that they sold you is a high deductible health plan. The person you spoke to might be a poorly trained call center employee who doesn't really know very much about health insurance.

---

@ahclem wrote:

since the term “HDHP” is an IRS invention

---

"High Deductible Health Plan" is not an IRS invention. It's defined in a law that Congress passed in 2003.

[Anonymous]

any  HDHP questions are only relevant if you had an HSA.  No HSA.  then whether you answered the questions correctly is irrelevant. 

however, if you qualified to have an HSA in 2018 by using the last month rule i.e. you didn't have a HDHP every month in 2018 but did on 12/1/18 and used that to qualify for a full year HSA contribution you must maintain a HDHP through Nov 19 in order to avoid having to pick up 11 months as income and pay a 10% penalty

[ahclem]

Thanks for the answers!