what is the penalty for using hsa distributions to pay non-qualified expenses
November 9th, 2010. The 2010 Health Care Act increased the penalty on non-qualified distributions from Health Savings Accounts (HSAâs) from 10% to 20% and on non-qualified distributions from Archer MSAâs from 15% to 20%. The increased penalties are effective for distributions made after December 31, 2010.