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Inventory Information Approval System (IIAS)
Please Note: As of January 1, 2011, FSA, HRA and HSA funds may no longer be used to purchase over-the-counter medications unless they are prescribed by a health care professional.
The IRS requires select retailers – including pharmacies, supermarkets, grocery, discount stores, wholesale clubs and mail-order merchants, to identify health-related items at the point of sale using the Inventory Information Approval System (IIAS). IIAS makes it possible to identify Card transactions at the check-out counter. This insures that you can only use the Card for eligible items, and does away with the need to submit receipts for verification after the purchase.
IRS Expands Use of Debit Card for OTC Drugs
On Thursday, December 23, 2010, the IRS issued Notice 2011-5, which clarifies the rules for when a Health FSA or Health Reimbursement Arrangement (HRA) may reimburse prescribed over-the-counter (OTC) medicine or drugs.
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IRS Delays discrimination testing ...
"In order to provide insured group health plan sponsors time to implement any changes required as a result of the regulations or other guidance, the Departments anticipate that the guidance will not apply until plan years beginning a specified period after issuance. Before the beginning of those plan years, an insured group health plan sponsor will not be required to file IRS Form 8928 with respect to excise taxes resulting from the incorporation of PHS Act § 2716 into § 9815 of the Code."