To amend the Internal Revenue Code of 1986 to eliminate certain tax benefits relating to abortion.

Summary: Amends the Internal Revenue Code to disqualify, for puposes of the tax deduction for medical expenses, any amounts paid for an abortion.

Excludes from the definition of "qualified health plan" after December 31, 2013, for purposes of the refundable tax credit for premium assistance for such plans, any plan that includes coverage for abortion. Permits: (1) the purchase of separate abortion coverage or health plans that include abortion coverage if premium assistance tax credits are not used for such purchase; and (2) non-federal health insurance issuers to offer separate abortion coverage or health plans that have abortion coverage if premiums for such coverage are not paid for with premium assistance tax credit amounts.

Excludes from the definitions of "qualified health plan" and "health insurance coverage," for purposes of the tax credit for small employer health insurance expenses, any health plan or benefit that includes coverage for abortions.

 Includes any reimbursements or distributions to pay for an abortion in the gross income of participants in flexible spending arrangements under a tax-exempt cafeteria plan, Archer Medical Savings Accounts (MSAs), and health savings accounts (HSAs).

Exempts from the application of this Act: (1) abortions for pregnancies resulting from rape or incest or in cases where a woman suffers from a physical disorder, injury, or illness that would, as certified by a physician, endanger her life if an abortion were not performed; and (2) the treatment of any infection, injury, disease, or disorder that was caused by or exacerbated by the performance of an abortion.

SECTION 1. DEDUCTION FOR MEDICAL EXPENSES NOT ALLOWED FOR ABORTIONS.

    (a) In General.--Section 213 of the Internal Revenue Code of 1986 
is amended by adding at the end the following new subsection:
    ``(g) Amounts Paid for Abortion Not Taken Into Account.--
            ``(1) In general.--An amount paid during the taxable year 
        for an abortion shall not be taken into account under 
        subsection (a).
            ``(2) Exceptions.--Paragraph (1) shall not apply to--
                    ``(A) an abortion--
                            ``(i) in the case of a pregnancy that 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 that would, as certified by a 
                        physician, place the woman in danger of death 
                        unless an abortion is performed, including a 
                        life-endangering physical condition caused by 
                        or arising from the pregnancy, and
                    ``(B) the treatment of any infection, injury, 
                disease, or disorder that has been caused by or 
                exacerbated by the performance of an abortion.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of the enactment of this Act.

SEC. 2. DISALLOWANCE OF REFUNDABLE CREDIT FOR COVERAGE UNDER QUALIFIED 
              HEALTH PLAN WHICH PROVIDES COVERAGE FOR ABORTION.

    (a) In General.--Subparagraph (A) of section 36B(c)(3) of the 
Internal Revenue Code of 1986 is amended by inserting before the period 
at the end the following: ``or any health plan that includes coverage 
for abortions (other than any abortion or treatment described in 
section 213(g)(2))''.
    (b) Option to Purchase or Offer Separate Coverage or Plan.--
Paragraph (3) of section 36B(c) of such Code is amended by adding at 
the end the following new subparagraph:
                    ``(C) Separate abortion coverage or plan allowed.--
                            ``(i) Option to purchase separate coverage 
                        or plan.--Nothing in subparagraph (A) shall be 
                        construed as prohibiting any individual from 
                        purchasing separate coverage for abortions 
                        described in such subparagraph, or a health 
                        plan that includes such abortions, so long as 
                        no credit is allowed under this section with 
                        respect to the premiums for such coverage or 
                        plan.
                            ``(ii) Option to offer coverage or plan.--
                        Nothing in subparagraph (A) shall restrict any 
                        non-Federal health insurance issuer offering a 
                        health plan from offering separate coverage for 
                        abortions described in such subparagraph, or a 
                        plan that includes such abortions, so long as 
                        premiums for such separate coverage or plan are 
                        not paid for with any amount attributable to 
                        the credit allowed under this section (or the 
                        amount of any advance payment of the credit 
                        under section 1412 of the Patient Protection 
                        and Affordable Care Act).''.
    (c) Effective Date.--The amendment made by this section shall apply 
to taxable years ending after December 31, 2013.

SEC. 3. DISALLOWANCE OF SMALL EMPLOYER HEALTH INSURANCE EXPENSE CREDIT 
              FOR PLAN WHICH INCLUDES COVERAGE FOR ABORTION.

    (a) In General.--Subsection (h) of section 45R of the Internal 
Revenue Code of 1986 is amended--
            (1) by striking ``Any term'' and inserting the following:
            ``(1) In general.--Any term'', and
            (2) by adding at the end the following new paragraph:
            ``(2) Exclusion of health plans including coverage for 
        abortion.--The terms `qualified health plan' and `health 
        insurance coverage' shall not include any health plan or 
        benefit that includes coverage for abortions (other than any 
        abortion or treatment described in section 213(g)(2)).''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 4. DISTRIBUTIONS FOR ABORTION EXPENSES FROM CERTAIN ACCOUNTS AND 
              ARRANGEMENTS INCLUDED IN GROSS INCOME.

    (a) Flexible Spending Arrangements Under Cafeteria Plans.--Section 
125 of the Internal Revenue Code of 1986 is amended by redesignating 
subsections (k) and (l) as subsections (l) and (m), respectively, and 
by inserting after subsection (j) the following new subsection:
    ``(k) Abortion Reimbursement From Flexible Spending Arrangement 
Included in Gross Income.--Notwithstanding section 105(b), gross income 
shall include any reimbursement for expenses incurred for an abortion 
(other than any abortion or treatment described in section 213(g)(2)) 
from a health flexible spending arrangement provided under a cafeteria 
plan. Such reimbursement shall not fail to be a qualified benefit for 
purposes of this section merely as a result of such inclusion in gross 
income.''.
    (b) Archer MSAs.--Paragraph (1) of section 220(f) of such Code is 
amended by inserting before the period at the end the following: ``, 
except that any such amount used to pay for an abortion (other than any 
abortion or treatment described in section 213(g)(2)) shall be included 
in the gross income of such holder''.
    (c) HSAs.--Paragraph (1) of section 223(f) of such Code is amended 
by inserting before the period at the end the following: ``, except 
that any such amount used to pay for an abortion (other than any 
abortion or treatment described in section 213(g)(2)) shall be included 
in the gross income of such beneficiary''.
    (d) Effective Dates.--
            (1) FSA reimbursements.--The amendment made by subsection 
        (a) shall apply to expenses incurred with respect to taxable 
        years beginning after the date of the enactment of this Act.
            (2) Distributions from savings accounts.--The amendments 
        made by subsection (b) and (c) shall apply to amounts paid with 
        respect to taxable years beginning after the date of the 
        enactment of this Act.