Exchange plan HSAs

(a) In general Section 223 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection: (i) Exchange plan HSAs For purposes of this section— (1) In general In the case of an Exchange plan HSA, this section shall be applied as provided in paragraphs (3) through (4). (2) Exchange plan HSA The term Exchange plan HSA means a health savings account which is designated as an Exchange plan HSA upon the establishment of such account. (3) No rollovers permitted Except in the case of a contribution from one Exchange plan HSA to another Exchange plan HSA, subsection (f)(5) shall not apply. (4) Restriction on use of amounts For purposes of subsection (d)(2)(A), amounts paid for— (A) abortion, other than— (i) if the pregnancy is the result of an act of rape or incest, or (ii) in the case where a woman suffers from a physical disorder, physical injury, or physical illness, including a life-endangering physical condition caused by or arising from the pregnancy itself, that would, as certified by a physician, place the woman in danger of death unless an abortion is performed, or (B) any sex trait modification procedure or service (as defined in section 156.400 of title 45, Code of Federal Regulations, as in effect on the date of the enactment of this subsection), shall not be treated as paid for medical care.. (b) Treatment of governmental contributions Paragraph (4) of section 223(b) of the Internal Revenue Code of 1986 is amended by striking and at the end of subparagraph (B), by striking the period at the end of subparagraph (C) and inserting, and, and by inserting after subparagraph (C) the following new subparagraph: (D) the aggregate amount contributed to an Exchange plan HSA pursuant to section 102(a) of the Health Care Freedom for Patients Act of 2025 which is excludable from the taxpayer's gross income for the taxable year under section 102(f) of such Act (and such amount shall not be allowed as a deduction under subsection (a)).. (c) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2025.