I 

118TH CONGRESS 

2D SESSION H. R. 9394 

To amend the Internal Revenue Code of 1986 to reform health provisions, 

and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

AUGUST 23, 2024 

Mr. MOORE of Utah (for himself, Mr. PANETTA, Mr. FITZPATRICK, Mr. 

SCHNEIDER, Mr. SMITH of Nebraska, and Mr. RUIZ) introduced the following bill; which was referred to the Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to reform 

health provisions, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Health Out-of-Pocket 

5 Expense Act of 2024’’ or the ‘‘HOPE Act of 2024’’. 

6 SEC. 2. HOPE ACCOUNTS. 

7 (a) ACCOUNTS ESTABLISHED.— 

8 (1) IN GENERAL.—Part VIII of subchapter F 

9 of chapter 1 of the Internal Revenue Code of 1986 


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1 is amended by adding at the end the following new 

2 section: 

3 ‘‘SEC. 530A. HOPE ACCOUNTS. 

4 ‘‘(a) IN GENERAL.—A HOPE Account shall be ex5 empt from taxation under this subtitle. Notwithstanding 

6 the preceding sentence, the Hope Account shall be subject 

7 to the taxes imposed by section 511 (relating to the impo8 sition of tax on unrelated business income of charitable 

9 organizations). 

10 ‘‘(b) DEFINITIONS AND SPECIAL RULES.—For pur11 poses of this section— 

12 ‘‘(1) HOPE ACCOUNT.—The term ‘HOPE Ac13 count’ means a trust created or organized in the 

14 United States as a HOPE Account exclusively for 

15 the purpose of paying the qualified medical expenses 

16 of the account beneficiary, but only if the written 

17 governing instrument creating the trust meets the 

18 following requirements: 

19 ‘‘(A) Except in the case of a rollover con20 tribution described in subsection (d)(4) of this 

21 section, no contribution will be accepted— 

22 ‘‘(i) unless it is in cash, or 

23 ‘‘(ii) to the extent such contribution, 

24 when added to previous contributions to 


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1 the trust for the calendar year, exceeds the 

2 contribution limitations in subsection (c). 

3 ‘‘(B) The trustee is a bank (as defined in 

4 section 408(n)), an insurance company (as de5 fined in section 816), or another person who 

6 demonstrates to the satisfaction of the Sec7 retary that the manner in which such person 

8 will administer the trust will be consistent with 

9 the requirements of this section. 

10 ‘‘(C) No part of the trust assets will be in11 vested in life insurance contracts. 

12 ‘‘(D) The assets of the trust will not be 

13 commingled with other property except in a 

14 common trust fund or common investment 

15 fund. 

16 ‘‘(E) The interest of an individual in the 

17 balance in the individual’s account is nonforfeit18 able. 

19 ‘‘(F) No more than reasonable fees are 

20 paid in connection with the administration of 

21 the account. 

22 ‘‘(G) The trust includes procedures for the 

23 trustee to reasonably assure that distributions 

24 are limited to payment or reimbursement for 

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1 tablishment of the trust. Procedures shall be 

2 considered reasonable that meet the substan3 tiation requirements contained in Proposed 

4 Treasury Regulation section 1.125-6 (as in ef5 fect on January 1, 2024) or under any super6 seding guidance prescribed by the Secretary. 

7 ‘‘(H) The trust follows all reporting re8 quirements as may be prescribed by the Sec9 retary with respect to distributions that are not 

10 substantiated as qualified medical expenses pur11 suant to this section. 

12 ‘‘(I) The trust follows any other guidance 

13 with respect to HOPE Accounts prescribed by 

14 the Secretary. 

15 ‘‘(J) Except as provided in subsection 

16 (d)(2)(B), amounts held by the trust may not 

17 be distributable other than exclusively to pay 

18 the qualified medical expenses of the account 

19 beneficiary, spouse or dependents. 

20 ‘‘(K) The trust reports all contributions on 

21 Form 5498–A, or such other form as is re22 quired by the Secretary. The trust annually 

23 must also— 

24 ‘‘(i) request each account owner to 

25 provide the trust with the amount if any, 


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1 the account owner contributed to an FSA 

2 for the year, and 

3 ‘‘(ii) report such amount on Form 

4 5498–A or such other form as is required 

5 by the Secretary. 

6 ‘‘(2) ELIGIBLE INDIVIDUAL.— 

7 ‘‘(A) IN GENERAL.—The term ‘eligible in8 dividual’ means, with respect to any month, any 

9 individual if for such month such individual 

10 meets the requirements of subparagraphs (B) 

11 and (C). 

12 ‘‘(B) COVERAGE REQUIREMENT.—An indi13 vidual meets the requirements of this subpara14 graph for a month if such individual is covered 

15 under one of the following types of coverage as 

16 of the 1st day of such month: 

17 ‘‘(i) Minimum essential coverage (as 

18 defined in section 5000A(f)). 

19 ‘‘(ii) With respect to members of fed20 erally recognized American Indian and 

21 Alaska Native Tribes and their descend22 ants, the Indian Health Service. 

23 ‘‘(C) OTHER COVERAGE.— 

24 ‘‘(i) IN GENERAL.—An individual 

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1 graph for a month if during such month 

2 no amounts are contributed by or on be3 half of the individual to any of the fol4 lowing accounts of such individual: 

5 ‘‘(I) A health flexible spending 

6 arrangement. 

7 ‘‘(II) A health savings account 

8 (as defined in section 223(d)). 

9 ‘‘(III) A health reimbursement 

10 arrangement which is treated as em11 ployer-provided coverage under an ac12 cident or health plan for purposes of 

13 section 106. 

14 ‘‘(IV) An Archer MSA (as de15 fined in section 220(d)). 

16 ‘‘(ii) EXCEPTION FOR CERTAIN DIS17 REGARDED COVERAGE.—Clause (i) shall 

18 not apply in the case of an account de19 scribed therein if for the month such ac20 count constitutes coverage described in sec21 tion 223(c)(1)(B). 

22 ‘‘(3) QUALIFIED MEDICAL EXPENSES.—The 

23 term ‘qualified medical expenses’ has the meaning 

24 given such term in section 223(d)(2). 


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1 ‘‘(4) ACCOUNT BENEFICIARY.—The term ‘ac2 count beneficiary’ means the individual on whose be3 half the HOPE Account was established. 

4 ‘‘(5) ACCOUNT TERMINATIONS.—Rules similar 

5 to the rules of paragraphs (2) and (4) of section 

6 408(e) shall apply to HOPE Accounts, and any 

7 amount treated as distributed under such rules shall 

8 be treated as not used to pay qualified medical ex9 penses. 

10 ‘‘(6) CERTAIN RULES TO APPLY.—Rules similar 

11 to the following rules shall apply for purposes of this 

12 section: 

13 ‘‘(A) Section 219(f)(3) (relating to time 

14 when contributions deemed made). 

15 ‘‘(B) Except as provided in section 106(h), 

16 section 219(f)(5) (relating to employer pay17 ments). 

18 ‘‘(C) Section 408(g) (relating to commu19 nity property laws). 

20 ‘‘(D) Section 408(h) (relating to custodial 

21 accounts). 

22 ‘‘(E) Section 223(f)(7) (relating to trans23 fer of account incident of divorce). 

24 ‘‘(F) Section 223(f)(8) (relating to treat25 ment after death of account beneficiary). 


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1 ‘‘(c) CONTRIBUTION LIMITATIONS.— 

2 ‘‘(1) IN GENERAL.—The aggregate amount of 

3 contributions from all sources to all HOPE Accounts 

4 maintained for the benefit of an eligible individual 

5 for any taxable year shall not exceed the sum of the 

6 monthly limitations for months during such taxable 

7 year that the individual is an eligible individual. 

8 ‘‘(2) MONTHLY LIMITATION.—The monthly limitation for any month is 1 9 ⁄12 of— 

10 ‘‘(A) in the case of an eligible individual 

11 who has self-only coverage, or an eligible indi12 vidual that is married filing separately or mar13 ried filing jointly that has family coverage, 

14 $4,000, or 

15 ‘‘(B) in the case of an eligible individual 

16 who has family coverage and is head of house17 hold, $8,000. 

18 ‘‘(3) LIMITATION ON THIRD PARTY CONTRIBU19 TIONS.—A trust shall not be treated as a Hope Ac20 count under this section unless the aggregate of con21 tributions on behalf of the individual from all em22 ployers of the individual and from any Medicaid pro23 gram established and administered by a State or 

24 subdivision thereof, if approved by the Secretary of 

25 Health and Human Services under Section 1115 of 


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1 the Social Security Act or Section 1332 of the Pa2 tient Protection and Affordable Care Act, will not be 

3 accepted in excess of 50 percent of the limit with re4 spect to such individual. 

5 ‘‘(4) NO DEDUCTION.—No deduction shall be 

6 allowed for a contribution made by an eligible indi7 vidual to a HOPE Account maintained for the ben8 efit of such individual for any taxable year. 

9 ‘‘(5) EXCLUSION FROM GROSS INCOME LIM10 ITED.—Any contribution under paragraph (c)(3) to 

11 the HOPE account of an individual whose adjusted 

12 gross income for the prior taxable year does not ex13 ceed $100,000 ($200,000 in the case of a married 

14 individual filing a joint return) shall be excluded 

15 from the individual’s adjusted gross income. 

16 ‘‘(6) COORDINATION WITH OTHER CONTRIBU17 TIONS.—The limitation which would (but for this 

18 paragraph) apply under this subsection to an indi19 vidual for any taxable year shall be reduced (but not 

20 below zero) by the sum of— 

21 ‘‘(A) the aggregate amount determined 

22 with respect to the individual for the taxable 

23 year under section 223(b)(4), 

24 ‘‘(B) the aggregate amount contributed by 

25 the individual to health savings accounts of the 


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1 individual for such taxable year and not taken 

2 into account under subparagraph (A), 

3 ‘‘(C) the aggregate amount contributed to 

4 a HOPE Account of such individual by the in5 dividual’s employer, and 

6 ‘‘(D) the aggregate amount contributed to 

7 a HOPE Account of such individual for such 

8 taxable year by a program established and ad9 ministered by a State or subdivision thereof 

10 with respect to converted cost-sharing reduction 

11 payments. 

12 ‘‘(7) COST-OF-LIVING ADJUSTMENT.—Each dol13 lar amount in paragraph (2) shall be increased by 

14 an amount equal to— 

15 ‘‘(A) such dollar amount, multiplied by 

16 ‘‘(B) the cost-of-living adjustment deter17 mined under section 1(f)(3) for the calendar 

18 year in which such taxable year begins deter19 mined— 

20 ‘‘(i) by substituting ‘calendar year 

21 2024’ for ‘calendar year 2016’ in subpara22 graph (A)(ii) thereof, and 

23 ‘‘(ii) by substituting ‘March 31’ for 

24 ‘August 31’ in section 1(f)(4). 


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1 The Secretary shall publish the adjusted 

2 amounts under paragraph (2) for taxable years 

3 beginning in any calendar year no later than 

4 June 1 of the preceding calendar year. If any 

5 increase under this paragraph is not a multiple 

6 of $50, such increase shall be rounded to the 

7 nearest multiple of $50. 

8 ‘‘(d) TAX TREATMENT OF DISTRIBUTIONS.— 

9 ‘‘(1) AMOUNTS USED FOR QUALIFIED MEDICAL

10 EXPENSES.—Any amount paid or distributed out of 

11 a HOPE Account which is used exclusively to pay 

12 qualified medical expenses of any account beneficiary 

13 shall not be includible in gross income. 

14 ‘‘(2) DISTRIBUTION AND TAXATION OF

15 AMOUNTS NOT USED FOR QUALIFIED MEDICAL EX16 PENSES.— 

17 ‘‘(A) IN GENERAL.—Except as provided in 

18 subparagraph (B), no amount may be paid or 

19 distributed out of a HOPE Account which is 

20 not used exclusively to pay the qualified medical 

21 expenses of the account beneficiary. 

22 ‘‘(B) EXCEPTION FOR CERTAIN DISTRIBU23 TIONS.—An amount may be paid or distributed 

24 out of a HOPE Account which is not used ex25 clusively to pay the qualified medical expenses 


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1 of the account beneficiary if such distribution is 

2 reported to the Secretary pursuant to such reg3 ulations or other guidance the Secretary may 

4 prescribe, and the distribution is— 

5 ‘‘(i) made to an account beneficiary 

6 (or to the estate of the account bene7 ficiary) on or after the death of the indi8 vidual, or 

9 ‘‘(ii) attributable to the account bene10 ficiary being disabled (within the meaning 

11 of section 72(m)(7)). 

12 ‘‘(C) TAXATION OF DISTRIBUTIONS NOT

13 USED FOR QUALIFIED MEDICAL EXPENSES.— 

14 ‘‘(i) IN GENERAL.—Any amount paid 

15 or distributed out of a HOPE Account 

16 which is not used exclusively to pay quali17 fied medical expenses of any account bene18 ficiary shall be includible in gross income, 

19 except to the extent such distribution is al20 locable to amounts described in subpara21 graph (D)(iii). 

22 ‘‘(ii) ADDITIONAL TAX.—The tax im23 posed by this chapter on the account bene24 ficiary for any taxable year in which there 

25 is a payment or distribution from a HOPE 


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1 Account of such beneficiary which is in2 cludible in gross income under clause (i) 

3 shall be increased by 30 percent of the 

4 amount which is so includible. 

5 ‘‘(D) ORDERING OF DISTRIBUTIONS.—Any 

6 distributions out of a HOPE Account pursuant 

7 to subparagraph (B) shall be treated as made 

8 from amounts to the extent that the amount of 

9 such distribution, when added to all previous 

10 distributions from the HOPE Account, does not 

11 exceed the aggregate of such amount, and from 

12 such amounts pursuant to the following order13 ing rules: 

14 ‘‘(i) from earnings, if any, on such 

15 amounts described in clauses (ii) and (iii), 

16 ‘‘(ii) from contributions described in 

17 subsection (c)(3), 

18 ‘‘(iii) from contributions by an eligible 

19 individual to the HOPE Account, and 

20 ‘‘(iv) from rollover contributions to 

21 the HOPE Account from another HOPE 

22 Account allocable to contributions by an el23 igible individual to such other HOPE Ac24 count, on a first-in, first-out basis. 


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1 ‘‘(3) EXCESS CONTRIBUTIONS RETURNED BE2 FORE DUE DATE OF RETURN.— 

3 ‘‘(A) IN GENERAL.—If any excess con4 tribution is contributed for a taxable year to 

5 any HOPE Account of an individual, paragraph 

6 (2) shall not apply to distributions from the 

7 HOPE Accounts of such individual (to the ex8 tent such distributions do not exceed the aggre9 gate excess contributions to all such accounts of 

10 such individual for such year) if— 

11 ‘‘(i) such distribution is received by 

12 the individual on or before the last day 

13 prescribed by law (including extensions of 

14 time) for filing such individual’s return for 

15 such taxable year, and 

16 ‘‘(ii) such distribution is accompanied 

17 by the amount of net income attributable 

18 to such excess contribution. 

19 Any net income described in clause (ii) shall be 

20 included in the gross income of the individual 

21 for the taxable year in which it is received. 

22 ‘‘(B) EXCESS CONTRIBUTION.—For pur23 poses of subparagraph (A), the term ‘excess 

24 contribution’ means any contribution (other 

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1 graph (4)) which is neither excludable from 

2 gross income under section 106(h) nor allow3 able under this section. 

4 ‘‘(4) ROLLOVER CONTRIBUTION.—An amount is 

5 described in this paragraph as a rollover contribu6 tion if it meets the requirements of subparagraphs 

7 (A) and (B). 

8 ‘‘(A) IN GENERAL.—Paragraph (2) shall 

9 not apply to any amount paid or distributed 

10 from a HOPE Account to the account bene11 ficiary to the extent the amount received is paid 

12 into a HOPE Account for the benefit of such 

13 beneficiary, the beneficiary’s spouse or the 

14 beneficiary’s dependent not later than the 60th 

15 day after the day on which the beneficiary re16 ceives the payment or distribution. 

17 ‘‘(B) LIMITATION.—This paragraph shall 

18 not apply to any amount described in subpara19 graph (A) received by an individual from a 

20 HOPE Account if, at any time during the 1- 

21 year period ending on the day of such receipt, 

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1 ual’s gross income because of the application of 

2 this paragraph. 

3 ‘‘(C) DEPENDENT.—The term dependent 

4 means any individual with respect to whom a 

5 deduction under section 151 is allowed to an6 other taxpayer for a taxable year beginning in 

7 the calendar year in which such individual’s 

8 taxable year begins. 

9 ‘‘(5) COORDINATION WITH MEDICAL EXPENSE

10 DEDUCTION.—For purposes of determining the 

11 amount of the deduction under section 213, any pay12 ment or distribution out of a HOPE Account for 

13 qualified medical expenses shall not be treated as an 

14 expense paid for medical care. 

15 ‘‘(e) REPORTS.—The Secretary shall require the 

16 trustee of a HOPE Account to make such reports regard17 ing such account to the Secretary and to the account bene18 ficiary with respect to contributions, distributions, the re19 turn of excess contributions, and such other matters as 

20 the Secretary determines appropriate. The trustee shall in21 clude in each such report an accounting of the amount 

22 contributed by the account beneficiary, and may, if nec23 essary to determine such amount, request such informa24 tion from the account beneficiary.’’. 


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1 (2) CLERICAL AMENDMENT.—The table of sec2 tions for part VIII of subchapter F of chapter 1 of 

3 such Code is amended by adding at the end the fol4 lowing new item: 

‘‘Sec. 530A. HOPE Accounts.’’. 

5 (b) EXCESS CONTRIBUTIONS.— 

6 (1) IN GENERAL.—Section 4973(a) of such 

7 Code is amended by striking ‘‘or’’ at the end of 

8 paragraph (5), by striking the period at the end of 

9 paragraph (6) and inserting ‘‘, and’’, and by insert10 ing after paragraph (6) (as so amended) the fol11 lowing new paragraph: 

12 ‘‘(7) A HOPE Account (as defined in section 

13 530A(b)).’’. 

14 (2) EXCESS CONTRIBUTIONS DEFINED.—Sec15 tion 4973 of such Code is amended by adding at the 

16 end the following new subsection: 

17 ‘‘(i) EXCESS CONTRIBUTIONS TO HOPE AC18 COUNT.— 

19 ‘‘(1) IN GENERAL.—For purposes of this sec20 tion, in the case of HOPE Accounts (within the 

21 meaning of section 530A(b)), the term ‘‘excess con22 tributions’’ means the sum of— 

23 ‘‘(A) The aggregate amount contributed 

24 for the taxable year to the accounts (other than 

25 a rollover contribution described in section 


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1 530A(d)(4)) which exceeds the contributions 

2 limits under section 530A(c), and 

3 ‘‘(B) the amount determined under this 

4 subsection for the preceding taxable year, re5 duced by the sum of— 

6 ‘‘(i) the distributions out of the ac7 counts which were included in gross in8 come under section 530A(d)(2)(C), and 

9 ‘‘(ii) the excess (if any) of— 

10 ‘‘(I) the maximum amount of al11 lowable contributions under 530A(c) 

12 for the taxable year, over 

13 ‘‘(II) the amount contributed to 

14 the accounts for the taxable year. 

15 ‘‘(2) RETURNED EXCESS CONTRIBUTIONS.—For 

16 purposes of this subsection, any contribution which 

17 is distributed out of the HOPE Account in a dis18 tribution to which section 530A(d)(2)(C) applies 

19 shall be treated as an amount not contributed.’’. 

20 (c) EMPLOYER CONTRIBUTIONS.— 

21 (1) IN GENERAL.—Section 106 of such Code is 

22 amended by adding at the end the following new 

23 subsection: 

24 ‘‘(h) CONTRIBUTIONS TO HOPE ACCOUNTS.— 


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1 ‘‘(1) IN GENERAL.—In the case of an employee 

2 who is an eligible individual, amounts contributed by 

3 such employee’s employer to any HOPE account (as 

4 defined in section 530A(b)) of such employee shall 

5 be treated as employer-provided coverage for medical 

6 expenses under an accident or health plan to the ex7 tent such amounts do not exceed the limitations ap8 plicable to such individual for such taxable year 

9 under section 530A(c) (determined without regard to 

10 this subsection). 

11 ‘‘(2) LIMITATION.—Paragraph (1) shall not 

12 apply in the case of a taxpayer whose adjusted gross 

13 income for the taxable year exceeds $100,000 

14 ($200,000 in the case of a joint return). 

15 ‘‘(3) SPECIAL RULES.—Rules similar to the 

16 rules of paragraphs (2), (3), (4), and (5) of sub17 section (b) shall apply for purposes of this sub18 section. 

19 ‘‘(4) CROSS REFERENCE.—For penalty on fail20 ure by employer to make comparable contributions 

21 to the health savings accounts of comparable em22 ployees, see section 4980G.’’. 

23 (2) INFORMATION REPORTING FOR EMPLOY24 EES.—Section 6051(a) is amended by striking 

25 ‘‘and’’ at the end of paragraph (16), by striking the 


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1 period at the end of paragraph (17) and inserting ‘‘, 

2 and’’, and by inserting after paragraph (17) (as so 

3 amended) the following new paragraph: 

4 ‘‘(18) the amount contributed to any HOPE 

5 Account (as defined in section 530A(b)) of such em6 ployee.’’. 

7 (3) CONFORMING AMENDMENT RELATING TO

8 CAFETERIA PLANS.—Section 125(f)(1) of such Code 

9 is amended by inserting ‘‘106(h),’’ after ‘‘106(b),’’. 

10 (d) FAILURE OF EMPLOYER TO MAKE COMPARABLE

11 HOPE ACCOUNT CONTRIBUTIONS.— 

12 (1) IN GENERAL.—Section 4980G(a) of such 

13 Code is amended by inserting ‘‘or HOPE Account’’ 

14 after ‘‘health savings account’’. 

15 (2) CONFORMING AMENDMENTS.— 

16 (A) Section 4980G(c) of such Code is 

17 amended by striking ‘‘and health savings ac18 counts’’ and inserting ‘‘, health savings ac19 counts, or HOPE Accounts’’. 

20 (B) Section 4980G(d) of such Code is 

21 amended by inserting ‘‘or HOPE Account’’ 

22 after ‘‘health savings account’’. 

23 (C) The heading for section 4980G of such 

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1 COUNT’’ after ‘‘HEALTH SAVINGS AC2 COUNT’’. 

3 (D) The table of sections for chapter 43 of 

4 such Code is amended by striking the item re5 lating to section 4980G and inserting the fol6 lowing new item: 

‘‘Sec. 4980G. Failure of employer to make comparable health savings account 

or HOPE Account contributions.’’. 

7 (e) APPLICATION OF PROHIBITED TRANSACTION

8 RULES.— 

9 (1) IN GENERAL.—Section 4975(e)(1) of such 

10 Code is amended by striking ‘‘or’’ at the end of sub11 paragraph (F), by redesignating subparagraph (G) 

12 as subparagraph (H), and by inserting after sub13 paragraph (F), as so amended, the following new 

14 subparagraph: 

15 ‘‘(G) a HOPE Account described in section 

16 530A(b), or’’. 

17 (f) FAILURE TO REPORT.—Section 6693(a)(2) of 

18 such Code is amended by striking ‘‘and’’ at the end of 

19 subparagraph (E), by striking the period at the end of 

20 subparagraph (F) and inserting ‘‘, and’’, and by inserting 

21 after subparagraph (F) (as so amended) the following new 

22 subparagraph: 

23 ‘‘(G) Section 530A(e) (relating to HOPE 

24 Accounts).’’. 


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1 (g) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2024. 

Æ 


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