In Announcement 2001-99, the Internal Revenue Service (IRS) says that since MSA returns for 2000 totaled just 36,250 and the applicable number of returns projected to be filed for 2001 is 76,035, October 1 will not be a “cutoff date” for the project, according to the Bureau of National Affairs (BNA).
Under the Health Insurance Portability and Accountability Act of 1996, individuals were allowed to open the tax-favored medical accounts as part of a pilot project effective January 1, 1997.
The MSA project, as amended by the Community Renewal Tax Relief Act of 2000, was scheduled to end in 2002. However, the legislation called for an earlier cutoff if the number of MSA returns filed on or before April 15, 2001, exceeded 750,000.
The agency projected 76,035 MSA returns would be filed for the 2001 tax year–about one-tenth of the number required for an early end to the pilot project.
Announcement 2001-99 will appear in Internal Revenue Bulletin 2001-42, dated Oct. 15.
– Nevin Adams email@example.com
See also MSAs May Get New Lease On “Life”
See also a perspective on Medical Savings Accounts .