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2022

Instructions for Form 8853

Department of the Treasury
Internal Revenue Service

Archer MSAs and Long-Term Care Insurance Contracts
Section references are to the Internal Revenue Code
unless otherwise noted.

Future Developments
For the latest information about developments
related to Form 8853 and its instructions, such
as legislation enacted after they were
published, go to IRS.gov/Form8853.

General Instructions
!

CAUTION

After December 31, 2007, contributions
can't be made to an Archer Medical
Savings Account for you, unless:

• You were an active Archer MSA participant
for any tax year ending before January 1, 2008,
or
• You became an active Archer MSA
participant for a tax year ending after December
31, 2007, because of coverage under a high
deductible health plan (HDHP) of an Archer
MSA participating employer.

Purpose of Form

Use Form 8853 to:

• Report Archer MSA contributions (including

employer contributions),
• Figure your Archer MSA deduction,
• Report distributions from Archer MSAs or
Medicare Advantage MSAs,
• Report taxable payments from long-term
care (LTC) insurance contracts, or
• Report taxable accelerated death benefits
from a life insurance policy.

Additional information. See Pub. 969, Health
Savings Accounts and Other Tax-Favored
Health Plans, for more details on MSAs.

Who Must File

You must file Form 8853 if any of the following
applies.
• You (or your employer) made contributions
for 2022 to your Archer MSA.
• You are filing a joint return and your spouse
(or their employer) made contributions for 2022
to your spouse's Archer MSA.
• You (or your spouse, if filing jointly) acquired
an interest in an Archer MSA or a Medicare
Advantage MSA because of the death of the
account holder. See Death of Account Holder,
later.
• You (or your spouse, if filing jointly) were a
policyholder who received payments under an
LTC insurance contract or received any
accelerated death benefits from a life insurance
policy on a per diem or other periodic basis in
2022. See the instructions for Section C, later.
• You (or your spouse, if filing jointly) received
Archer MSA or Medicare Advantage MSA
distributions in 2022.

!

CAUTION

If you (or your spouse, if filing jointly)
received Archer MSA or Medicare
Advantage MSA distributions in 2022,

Oct 25, 2022

you must file Form 8853 with Form 1040,
1040-SR, or 1040-NR even if you have no
taxable income or any other reason for filing
Form 1040, 1040-SR, or 1040-NR.

Specific Instructions
Name and social security number (SSN).
Enter your name(s) and SSN as shown on your
tax return. If filing jointly and both you and your
spouse each have an Archer MSA or each have
a Medicare Advantage MSA, enter the SSN
shown first on your tax return.

Section A—Archer MSAs
Eligible Individual
To be eligible for an Archer MSA, you (or your
spouse) must be an employee of a small
employer or be self-employed. You (or your
spouse) must be covered under an HDHP and
have no other health coverage except permitted
coverage. You must not be enrolled in Medicare
and can't be another person’s dependent. You
must be an eligible individual on the first day of
a month to take an Archer MSA deduction for
that month.

Self-only
coverage

Family
coverage

Minimum annual deductible

$2,450

$4,950

Maximum annual deductible

$3,700

$7,400

Maximum annual
out-of-pocket expenses
(other than for premiums)

$4,950

$9,050

Other Health Coverage
If you have an Archer MSA, you (and your
spouse, if you have family coverage) can't have
any health coverage other than an HDHP.
However, your spouse can have health
coverage other than an HDHP if you aren't
covered by that plan.
Exceptions. You can have additional
insurance that provides benefits only for:
• Liabilities under workers' compensation
laws, tort liabilities, or liabilities arising from the
ownership or use of property;
• A specific disease or illness; or
• A fixed amount per day (or other period) of
hospitalization.

A small employer is generally an employer who
had an average of 50 or fewer employees
during either of the last 2 calendar years. See
Pub. 969 for details.

You can also have coverage (either through
insurance or otherwise) for accidents, disability,
dental care, vision care, or long-term care. See
Other health coverage in Pub. 969, Health
Savings Accounts and Other Tax-Favored
Health Plans, for additional information about
exceptions.

Archer MSA

Disabled

Small Employer

Generally, an Archer MSA is a medical savings
account set up exclusively for paying the
qualified medical expenses of the account
holder.

Qualified Medical Expenses
Generally, qualified medical expenses for
Archer MSA purposes are unreimbursed
medical expenses that could otherwise be
deducted on Schedule A (Form 1040). See the
Instructions for Schedule A (Form 1040), and
Pub. 502, Medical and Dental Expenses.
Qualified medical expenses are those incurred
by the account holder or the account holder's
spouse or dependent(s). Amounts paid for
menstrual care products shall be treated as
paid for medical care. See the instructions for
Line 7, later. You can't treat insurance
premiums as qualified medical expenses unless
the premiums are for:
• LTC insurance,
• Health care continuation coverage, or
• Health care coverage while receiving
unemployment compensation under federal or
state law.

High Deductible Health Plan
An HDHP is a health plan that meets the
following requirements.

Cat. No. 24188L

An individual is generally considered disabled if
they are unable to engage in any substantial
gainful activity due to a physical or mental
impairment that can be expected to result in
death or to continue indefinitely.

Death of Account Holder
If the account holder's surviving spouse is the
designated beneficiary, the Archer MSA is
treated as if the surviving spouse were the
account holder. The surviving spouse
completes Form 8853 as though the Archer
MSA belonged to them.
If the designated beneficiary isn't the
account holder's surviving spouse, or there is
no designated beneficiary, the account ceases
to be an Archer MSA as of the date of death.
The beneficiary completes Form 8853 as
follows.
• Enter “Death of Archer MSA account holder”
across the top of Form 8853.
• Enter the name(s) shown on the
beneficiary's tax return and the beneficiary's
SSN in the spaces provided at the top of the
form and skip Part I.
• On lines 6a and 6c, enter the fair market
value of the Archer MSA as of the date of death.
• On line 7, for a beneficiary other than the
estate, enter qualified medical expenses
incurred by the account holder before the date

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of death that you paid within 1 year after the
date of death.
• Complete the rest of Part II.
If the account holder's estate is the
beneficiary, the fair market value of the Archer
MSA as of the date of death is included in the
account holder's final income tax return.
Complete Form 8853 as described above,
except you should complete Part I, if applicable.
The transfer isn't subject to the additional
20% tax. Report any earnings on the account
after the date of death as income on your tax
return.
Note. If, during the tax year, you are the
beneficiary of two or more Archer MSAs or you
are a beneficiary of an Archer MSA and you
have your own Archer MSA, you must complete
a separate Form 8853 for each Medicare
Advantage MSA. Enter “statement” at the top of
each Form 8853 and complete the form as
instructed. Next, complete a controlling Form
8853, combining the amounts shown on each of
the statement Forms 8853. Attach the
statements to your paper tax return after the
controlling Form 8853.

Deemed Distributions From
Archer MSAs
The following situations result in deemed
distributions from your Archer MSA.
• You engaged in any transaction prohibited
by section 4975 with respect to any of your
Archer MSAs at any time in 2022. Your account
ceases to be an Archer MSA as of January 1,
2022, and you must include the fair market
value of all assets in the account as of January
1, 2022, on line 6a.
• You used any portion of any of your Archer
MSAs as security for a loan at any time in 2022.
You must include the fair market value of the
assets used as security for the loan as income
on Schedule 1 (Form 1040), line 8e.
Any deemed distribution won't be treated as
used to pay qualified medical expenses.
Generally, these distributions are subject to the
additional 20% tax.

Part I—Archer MSA
Contributions and
Deductions

Use Part I to figure:
• Your Archer MSA deduction,
• Any excess contributions you made, and
• Any excess contributions made by an
employer (see Excess Employer Contributions,
later).

Figuring Your Archer MSA
Deduction
The amount you can deduct for Archer MSA
contributions is limited by:
• The applicable portion of the HDHP's annual
deductible (line 3), and
• Your compensation from the employer
maintaining the HDHP (line 4).
Any employer contributions made to your
Archer MSA prevent you from making
deductible contributions. See Employer
Contributions to an Archer MSA, later. Also, if
you or your spouse made contributions in
addition to any employer contributions, you may

have to pay an additional tax. See Excess
Contributions You Make, later.
You can't deduct any contributions you
made after you became enrolled in Medicare.
Also, you can't deduct contributions if you are
someone else’s dependent.

Employer Contributions to an
Archer MSA
If an employer made contributions to your
Archer MSA, you aren't entitled to a deduction.
If you and your spouse are covered under an
HDHP with family coverage and an employer
made contributions to either of your Archer
MSAs, neither you nor your spouse is allowed
to make deductible contributions to an Archer
MSA. If you and your spouse both have an
HDHP with self-only coverage and only one of
you received employer contributions to an
Archer MSA, the other spouse is allowed to
make deductible contributions to an Archer
MSA.

How To Complete Part I
Complete lines 1 through 5 as instructed on the
form unless (1) or (2), next, applies.
1. If employer contributions to an Archer
MSA prevent you from taking a deduction for
amounts you contributed to your Archer MSA,
complete Part I as follows.
a.

Complete lines 1 and 2.

b.

Skip lines 3 and 4.

c.

Enter -0- on line 5.

d. If line 2 is more than zero, see Excess
Contributions You Make, later.
2. If you and your spouse have more than
one Archer MSA, complete Part I as follows.
a. If either spouse has an HDHP with
family coverage, you both are treated as having
only the family coverage plan. Disregard any
plans with self-only coverage.

Line 2
Include on line 2 contributions you made to your
Archer MSA in 2022. Also include those
contributions made from January 1, 2023,
through April 18, 2023, that were for 2022. Don't
include amounts rolled over from another
Archer MSA. See Rollovers, later.

Line 3
Go through the chart at the top of the Line 3
Limitation Chart and Worksheet for each month
of 2022. Enter the result on the worksheet next
to the corresponding month. Enter the amount
from the last line of the worksheet on line 3.
If eligibility and coverage for both you

TIP and your spouse didn't change from

one month to the next, enter the same
number you entered for the previous month. If
eligibility and coverage didn't change during the
entire year, figure the number for January only,
and enter this amount on Form 8853, line 3.
More than one HDHP. If you and your spouse
had more than one HDHP on the first day of the
month and one of the plans provides family
coverage, use the Family coverage rules on the
chart and disregard any plans with self-only
coverage. If you and your spouse both have
HDHPs with family coverage on the first day of
the month, you both are treated as having only
the family coverage plan with the lowest annual
deductible.
Married filing separately. If you have an
HDHP with family coverage and are married
filing separately, enter only 37.5% (0.375)
(one-half of 75%) of the annual deductible for
each month on the worksheet; or, if you and
your spouse agree to divide the 75% of the
annual deductible in a different manner, enter
your share.

Line 4
Compensation

c. If both spouses have HDHPs with
self-only coverage, complete a separate Form
8853, Section A, Part I, for each spouse. Enter
“statement” across the top of each Form 8853,
fill in the name and SSN, and complete Part I.
Next, add lines 1, 2, and 5 from the two
statement Forms 8853 and enter those totals on
the respective lines of the controlling Form
8853 (the combined Form 8853 for both
spouses). Don't complete lines 3 and 4 of the
controlling Form 8853. Attach the two statement
Forms 8853 to your paper tax return after the
controlling Form 8853.

Compensation includes wages, salaries,
professional fees, and other pay you receive for
services you perform. It also includes sales
commissions, commissions on insurance
premiums, pay based on a percentage of
profits, tips, and bonuses. Generally, these
amounts are included on the Form(s) W-2 you
receive from your employer(s). Compensation
also includes net earnings from
self-employment, but only for a trade or
business in which your personal services are a
material income-producing factor. This is your
income from self-employment minus expenses
(including the deductible part of
self-employment tax). Compensation doesn't
include any amounts received as a pension or
annuity and doesn't include any amount
received as deferred compensation.

Line 1

Line 5

b. If both spouses have HDHPs with family
coverage, you both are treated as having only
the family coverage plan with the lowest annual
deductible.

Employer Contributions
Employer contributions include any amount an
employer contributes to any Archer MSA for
you or your spouse for 2022. These
contributions should be shown in box 12 of
Form W-2 with code R. If your employer made
excess contributions, you may have to report
the excess as income. See Excess Employer
Contributions, later, for details.
-2-

If you (or your employer) contributed more to
your Archer MSA than is allowable, you may
have to pay an additional tax on the excess
contributions. Figure the excess contributions
using the following instructions. See Form
5329, Additional Taxes on Qualified Plans
(Including IRAs) and Other Tax-Favored
Accounts, to figure the additional tax.

Instructions for Form 8853 (2022)

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Line 3 Limitation Chart and Worksheet

Excess Contributions You Make
To figure your excess contributions, subtract
your deductible contributions (line 5) from your
actual contributions (line 2). However, you can
withdraw some or all of your excess
contributions for 2022, and they will be treated
as if they hadn't been contributed if:
• You make the withdrawal by the due date,
including extensions, of your 2022 tax return
(but see the Note under Excess Employer
Contributions below);
• You don't claim a deduction for the amount
of the withdrawn contributions; and
• You also withdraw any income earned on the
withdrawn contributions and include the
earnings in “Other income” on your tax return
for the year you withdraw the contributions and
earnings.

Before you begin: √ See the instructions for line 3.
√ Go through this chart for each month of 2022.
√ Keep for your records.
Start Here
Were you enrolled in Medicare for the month?
No
Were you an eligible individual (see Eligible
Individual, earlier) on the first day of the
month?

Note. If you timely filed your return without
withdrawing the excess contributions, you can
still make the withdrawal no later than 6 months
after the due date of your tax return, excluding
extensions. If you do, file an amended return
with “Filed pursuant to section 301.9100-2”
written at the top. Include an explanation of the
withdrawal. Make all necessary changes on the
amended return (for example, if you reported
the contributions as excess contributions on
your original return, include an amended Form
5329 reflecting that the withdrawn contributions
are no longer treated as having been
contributed).

Enter -0- on
the line below
for the month.

What type of coverage did your HDHP provide on the first day of the month?
If you had more than one HDHP, see More than one HDHP, earlier.
Self-only coverage

Family coverage

Enter annual deductible
(must be at least $2,450 but
not more than $3,700).
$

Enter annual deductible
(must be at least $4,950 but
not more than $7,400).
$

Enter 65% (0.65) of the annual
deductible on the line below
for the month.

Enter 75% (0.75) of the annual
deductible on the line below
for the month. If married filing
separately, see Married filing
separately.

Amount from
chart above

Month in 2022
January

. . . . . . . . . . . . . . . . . $

February

. . . . . . . . . . . . . . . . . $

March

. . . . . . . . . . . . . . . . . . $

April

. . . . . . . . . . . . . . . . . . . $

May

. . . . . . . . . . . . . . . . . . . $

June . . . . . . . . . . . . . . . . . . . $
July

. . . . . . . . . . . . . . . . . . . $

Deducting an Excess Contribution
in a Later Year

August

You may be able to deduct excess
contributions for previous years that are still in
your Archer MSA. The excess contribution you
can deduct in the current year is the lesser of
the following two amounts.
• Your maximum Archer MSA contribution limit
for the year minus any amounts contributed to
your Archer MSA for the year.
• The total excess contributions in your Archer
MSA at the beginning of the year.

October

Instructions for Form 8853 (2022)

No

Yes

Excess Employer Contributions
Excess employer contributions are the excess,
if any, of your employer's contributions over the
smaller of (a) your limitation on line 3, or (b)
your compensation from the employer(s) who
maintained your HDHP (line 4). If the excess
wasn't included in income on Form W-2, you
must report it as “Other income” on your tax
return. However, you can withdraw some or all
of the excess employer contributions for 2022,
and they will be treated as if they hadn't been
contributed if:
• You make the withdrawal by the due date,
including extensions, of your 2022 tax return
(but see the Note below);
• You don't claim an exclusion from income for
the amount of the withdrawn contributions; and
• You also withdraw any income earned on the
withdrawn contributions and include the
earnings in “Other income” on your tax return
for the year you withdraw the contributions and
earnings.

Yes

. . . . . . . . . . . . . . . . . . $

September

. . . . . . . . . . . . . . . . $
. . . . . . . . . . . . . . . . . $

November

. . . . . . . . . . . . . . . . $

December

. . . . . . . . . . . . . . . . $

Total for all months

. . . . . . . . . . . . . $

Limitation. Divide the total by 12.
Enter here and on line 3 . . . . . . . . . . . . $

-3-

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Any excess contribution remaining at the
end of a tax year is subject to the additional tax.
See Form 5329.

Part II—Archer MSA
Distributions
Line 6a
Enter the total distributions you and your
spouse received in 2022 from all Archer MSAs.
These amounts should be shown in box 1 of
Form 1099-SA.

Line 6b
Include on line 6b any distributions you
received in 2022 that were rolled over. See
Rollovers below. Also include any excess
contributions (and the earnings on those
excess contributions) included on line 6a that
were withdrawn by the due date, including
extensions, of your return. See the instructions
for line 5, earlier.

Rollovers
A rollover is a tax-free distribution (withdrawal)
of assets from one Archer MSA that is
reinvested in another Archer MSA or a health
savings account (HSA) of the same account
holder. Generally, you must complete the
rollover within 60 days following the distribution.
An Archer MSA and an HSA can receive only
one rollover contribution in a 1-year period. See
Pub. 590-A, Contribution to Individual
Retirement Arrangements (IRAs), for more
details and additional requirements regarding
rollovers.
Note. If you instruct the trustee of your Archer
MSA to transfer funds directly to the trustee of
another of your Archer MSAs, the transfer isn't
considered a rollover. There is no limit on the
number of these transfers. Don't include the
amount transferred in income, deduct it as a
contribution, or include it as a distribution on
line 6a.

Line 7
In general, include on line 7 distributions from
all Archer MSAs in 2022 that were used for the
qualified medical expenses (see Qualified
Medical Expenses, earlier) of:
1.

Yourself and your spouse;

2.

All your dependents; and

3. Any person who would be your
dependent except that:
a.

The person filed a joint return;

b. The person had gross income of $4,400
or more; or
c. You, or your spouse if filing jointly, are
dependents of someone else.
For this purpose, a child of parents who

TIP are divorced, separated, or living apart

for the last 6 months of the calendar
year is treated as the dependent of both parents
whether or not the custodial parent releases the
claim to the child as their dependent.
However, if you or your employer made a
contribution to your Archer MSA in 2022 and
you used withdrawals to pay expenses for an
individual who wasn't covered by an HDHP or
was covered by a plan that wasn't an HDHP

(other than the exceptions listed under Other
Health Coverage, earlier) at the time the
expenses were incurred, then you shouldn't
include those withdrawals on line 7.
Example. In 2022, you were covered by an
HDHP with self-only coverage and your spouse
was covered by a health plan that wasn't an
HDHP. You made contributions to an Archer
MSA for 2022. You can't include on line 7
withdrawals made from the Archer MSA to pay
your spouse's medical expenses incurred in
2022 because your spouse was covered by a
plan that wasn't an HDHP.
You can't take a deduction on
Schedule A (Form 1040) or Schedule A
CAUTION (Form 1040-NR) for any amount you
include on line 7.

!

Lines 9a and 9b
Additional 20% Tax
Archer MSA distributions included in income
(line 8) are subject to an additional 20% tax
unless one of the following exceptions applies.

Exceptions to the Additional 20%
Tax
The additional 20% tax doesn't apply to
distributions made after the date that the
account holder:
• Dies,
• Becomes disabled (see Disabled, earlier), or
• Turns age 65.
If any of the exceptions applies to any of the
distributions included on line 8, check the box
on line 9a. Enter on line 9b only 20% (0.20) of
any amount included on line 8 that doesn't meet
any of the exceptions.
Example 1. You turned age 66 in 2022 and
had no Archer MSA during 2022. Your spouse
turned age 63 in 2022 and received a
distribution from an Archer MSA that is included
in income. Don't check the box on line 9a
because your spouse (the account holder)
didn't meet the age exception for the
distribution. Enter 20% of the amount from
line 8 on line 9b.
Example 2. Both you and your spouse
received distributions from your Archer MSAs in
2022 that are included in income. You were age
65 at the time you received the distributions and
your spouse was age 63 when they received
the distributions. Check the box on line 9a
because the additional 20% tax doesn't apply to
the distributions you received (because you met
the age exception). However, the additional
20% tax does apply to your spouse's
distributions. Enter on line 9b only 20% of the
amount of your spouse's distributions included
on line 8.
Example 3. You turned age 65 in 2022.
You received distributions that are included in
income both before and after you turned age
65. Check the box on line 9a because the
additional 20% tax doesn't apply to the
distributions made after the date you turned age
65. However, the additional 20% tax does apply
to the distributions made on or before the date
you turned age 65. Enter on line 9b, 20% of the
amount of these distributions included on line 8.

-4-

Section B—Medicare
Advantage MSA
Distributions

Complete Section B if you (or your spouse, if
filing jointly) received distributions from a
Medicare Advantage MSA in 2022. If both you
and your spouse received distributions,
complete a separate Form 8853, Section B, for
each spouse. Enter “statement” across the top
of each Form 8853, fill in the name and SSN,
and complete Section B. Next, add lines 10, 11,
12, and 13b from the two statement Forms
8853 and enter those totals on the respective
lines of the controlling Form 8853 (the
combined Form 8853 for both spouses). If
either spouse checked the box on line 13a of
the statement Form 8853, check the box on the
controlling Form 8853. Attach the two statement
Forms 8853 to your paper tax return after the
controlling Form 8853.
If you (or your spouse, if filing jointly)
received distributions from a Medicare
CAUTION Advantage MSA in 2022, you must file
Form 8853 with a Form 1040, 1040-SR, or
1040-NR even if you have no taxable income or
any other reason for filing Form 1040, 1040-SR,
or 1040-NR.

!

Medicare Advantage MSA
A Medicare Advantage MSA is an Archer MSA
designated as a Medicare Advantage MSA to
be used solely to pay the qualified medical
expenses of the account holder. To be eligible
for a Medicare Advantage MSA, you must be
enrolled in Medicare and have an HDHP that
meets the Medicare guidelines. Contributions to
the account can be made only by Medicare.
The contributions and any earnings, while in the
account, aren't taxable to the account holder. A
distribution used exclusively to pay for the
qualified medical expenses of the account
holder isn't taxable. Distributions that aren't
used for qualified medical expenses of the
account holder are included in income and also
may be subject to a penalty.

Death of Account Holder
If the account holder's surviving spouse is the
designated beneficiary, the Medicare
Advantage MSA is treated as a regular Archer
MSA (not a Medicare Advantage MSA) of the
surviving spouse for distribution purposes.
Follow the instructions in Section A for Death of
Account Holder, earlier.
If the designated beneficiary isn't the
account holder's surviving spouse, or there is
no designated beneficiary, the account ceases
to be an MSA as of the date of death. The
beneficiary completes Form 8853 as follows.
• Enter “Death of Medicare Advantage MSA
account holder” across the top of Form 8853.
• Enter the name(s) shown on the
beneficiary's tax return and the beneficiary's
SSN in the spaces provided at the top of the
form. Skip Section A.
• On line 10, enter the fair market value of the
Medicare Advantage MSA as of the date of
death.
• On line 11, for a beneficiary other than the
estate, enter qualified medical expenses
incurred by the account holder before the date
of death that you paid within 1 year after the
date of death.
• Complete the rest of Section B.

Instructions for Form 8853 (2022)

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Additional 50% Tax Worksheet—Line 13b

Keep for Your Records

1.

Enter the total distributions included on Form 8853, line 12, that don't meet either of the exceptions to the additional 50% tax

2.

Did you have a Medicare Advantage MSA on December 31, 2021?
No.

STOP

. . . . . . . . . . . . . .

1.

Enter one-half of line 1 above on Form 8853, line 13b.

Yes. Enter the value of your Medicare Advantage MSA on December 31, 2021

. . . . . . . . . . . . . . . . . . . .

2.

3.

Enter the amount of the annual deductible for your HDHP policy on January 1,
2022 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4.

Multiply line 3 by 60% (0.60) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5.

Subtract line 4 from line 2. If zero or less, enter -0-

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5.

6.

Subtract line 5 from line 1. If zero or less, enter -0-

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6.

7.

Enter one-half of line 6 here and on Form 8853, line 13b

If the account holder's estate is the
beneficiary, the fair market value of the
Medicare Advantage MSA as of the date of
death is included in the account holder's final
income tax return.
The transfer isn't subject to the additional
50% tax. The beneficiary should report any
earnings on the account after the date of death
as income on the beneficiary's tax return.
Note. If, during the tax year, you are the
beneficiary of two or more Medicare Advantage
MSAs or you are a beneficiary of a Medicare
Advantage MSA and you have your own
Medicare Advantage MSA, you must complete
a separate Form 8853 for each MSA. Enter
“statement” at the top of each Form 8853 and
complete the form as instructed. Next, complete
a controlling Form 8853, combining the
amounts shown on each of the statement
Forms 8853. Attach the statements to your
paper tax return after the controlling Form 8853.

Line 10
Enter the total distributions you received in
2022 from all Medicare Advantage MSAs.
These amounts should be shown in box 1 of
Form 1099-SA. This amount shouldn't include
any erroneous contributions made by Medicare
(or any earnings on the erroneous
contributions) or any amounts from a
trustee-to-trustee transfer from one Medicare
Advantage MSA to another Medicare
Advantage MSA of the same account holder.

Line 11
Enter the total distributions from all Medicare
Advantage MSAs in 2022 that were used only
for the account holder's qualified medical
expenses (see Qualified Medical Expenses,
earlier).
You can't take a deduction on
Schedule A (Form 1040) or Schedule A
CAUTION (Form 1040-NR) for any amount you
include on line 11.

!

Lines 13a and 13b
Additional 50% Tax
Medicare Advantage MSA distributions
included in income (line 12) may be subject to
an additional 50% tax unless one of the
following exceptions applies.

Instructions for Form 8853 (2022)

3.
4.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Exceptions to the Additional 50%
Tax
The additional 50% tax doesn't apply to
distributions made on or after the date that the
account holder:
• Dies, or
• Becomes disabled (see Disabled, earlier).
If either of the exceptions applies to any of the
distributions included on line 12, check the box
on line 13a. Next, if either of the exceptions
applies to all the distributions included on
line 12, enter -0- on line 13b. Otherwise,
complete the Additional 50% Tax
Worksheet—Line 13b to figure the amount of
the additional 50% tax to enter on line 13b.

Section C—Long-Term
Care (LTC) Insurance
Contracts

See Filing Requirements for Section C, later.
Also, for more information, see Pub. 502.

Definitions
Policyholder
The policyholder is the person who owns the
proceeds of the LTC insurance contract, life
insurance contract, or viatical settlement, and
also can be the insured individual. The
policyholder is required to report the income,
even if payment is assigned to a third party or
parties. In the case of a group contract, the
certificate holder is considered to be the
policyholder.

Qualified LTC Insurance Contract
A qualified LTC insurance contract is a contract
issued:
• After December 31, 1996, that meets the
requirements of section 7702B, including the
requirement that the insured must be a
chronically ill individual (defined later); or
• Before January 1, 1997, that met state law
requirements for LTC insurance contracts at the
time when and in the state where the contract
was issued and hasn't been changed
materially.
In general, amounts paid under a qualified
LTC insurance contract are excluded from your
income. However, if you receive Per Diem
-5-

7.

Payments (defined next), the amount you can
exclude is limited.

Per Diem Payments
Per diem payments are payments of a fixed
amount made on a periodic basis without
regard to actual expenses incurred. Box 3 of
Form 1099-LTC should indicate whether
payments were per diem payments.

Chronically Ill Individual
A chronically ill individual is someone who has
been certified (at least annually) by a licensed
health care practitioner as:
• Being unable to perform at least two
activities of daily living (eating, toileting,
transferring, bathing, dressing, and
continence), without substantial assistance
from another individual, for at least 90 days,
due to a loss of functional capacity; or
• Requiring substantial supervision to protect
the individual from threats to health and safety
due to severe cognitive impairment. An
individual must have been certified within the
past 12 months as meeting this condition.

Accelerated Death Benefits
Generally, amounts paid as accelerated death
benefits under a life insurance contract or for
the sale or assignment of any portion of the
death benefit as part of a viatical settlement are
fully excludable from your gross income if the
insured is a Terminally Ill Individual (defined
below). Accelerated death benefits paid with
respect to an insured individual who is
chronically ill are generally excludable from
your gross income to the same extent as they
would be under a qualified LTC insurance
contract.

Terminally Ill Individual
A terminally ill individual is any individual who
has been certified by a physician as having an
illness or physical condition that can reasonably
be expected to result in death within 24 months
of the date of certification.

Line 15
Special rules apply in determining the taxable
payments if other individuals received per diem
payments under a qualified LTC insurance

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Filing Requirements for Section C
Go through this chart for each insured person for whom you received
long-term care (LTC) payments. See Definitions, earlier.
Start Here
Did you (or your spouse, if filing
jointly) receive payments in
2022 made on a per diem or
other periodic basis under an
LTC insurance contract?

Were any of those payments
made under a qualified LTC
insurance contract?

Yes

Complete all
of Section C.

No

No

Did you (or your spouse, if
filing jointly) receive any
accelerated death benefits in
2022 from a life insurance
policy that were made on a per
diem or other periodic basis?

Did you (or your spouse, if
filing jointly) receive any
accelerated death benefits in
2022 from a life insurance
policy that were made on a per
diem or other periodic basis?

No

Complete only
lines 14a, 14b, and 17
of Section C.

Yes

No
Don’t complete
Section C.

Yes

Were any of the payments paid
on behalf of a chronically ill
(not terminally ill) individual?

Yes

No

Complete only
lines 14a, 14b, 15, 16,
17 (if applicable), and 26
of Section C.

Yes
Complete all of Section C.
contract or as accelerated death benefits with
respect to the insured listed on line 14a. See
Multiple Payees, later, for details.

Line 18
If you have more than one LTC period,
you must separately calculate the
CAUTION taxable amount of the payments
received during each LTC period. To do this,
complete lines 18 through 26 on separate
Sections C for each LTC period. Enter the total
on line 26 from each separate Section C on the
Form 8853 that you attach to your tax return.
See the instructions for line 21 for the LTC
period.

!

Line 19
Enter the total accelerated death benefits you
received with respect to the insured listed on
line 14a. These amounts are generally shown in
box 2 of Form 1099-LTC. Include only amounts
you received while the insured was a
chronically ill individual. Don't include amounts
you received while the insured was a terminally
ill individual. If the insured was redesignated
from chronically ill to terminally ill in 2022, only
include on line 19 payments received before the
insured was certified as terminally ill.

Line 21
The number of days in your LTC period
depends on which method you choose to define
the LTC period. Generally, you can choose
either the Contract Period method or the Equal
Payment Rate method. However, special rules
apply if other persons also received per diem

payments in 2022 under a qualified LTC
insurance contract or as accelerated death
benefits with respect to the insured listed on
line 14a. See Multiple Payees, later, for details.

Method 1—Contract Period
Under this method, your LTC period is the same
period as that used by the insurance company
under the contract to compute the benefits it
pays you. For example, if the insurance
company computes your benefits on a daily
basis, your LTC period is 1 day.
If you choose this method for defining
the LTC period(s) and different LTC
CAUTION insurance contracts for the same
insured use different contract periods, then all
such LTC contracts must be treated as
computing benefits on a daily basis.

!

Method 2—Equal Payment Rate
Under this method, your LTC period is the
period during which the insurance company
uses the same payment rate to compute your
benefits. For example, you have two LTC
periods if the insurance contract computes
payments at a rate of $175 per day from March
1, 2022, through May 31, 2022, and then at a
rate of $195 per day from June 1, 2022, through
December 31, 2022. The first LTC period is 92
days (from March 1 through May 31) and the
second LTC period is 214 days (from June 1
through December 31).
-6-

You can choose this method even if you
have more than one qualified LTC insurance
contract covering the same period. For
example, you have one insurance contract that
pays $100 per day from March 1, 2022, through
December 31, 2022, and a second contract that
pays $1,500 per month from March 1, 2022,
through December 31, 2022. You have one
LTC period because each payment rate doesn't
vary during the LTC period of March 1 through
December 31. However, you have two LTC
periods if the facts are the same except that the
second insurance contract didn't begin making
payments until May 1, 2022. The first LTC
period is 61 days (March 1 through April 30)
and the second LTC period is 245 days (May 1
through December 31).

Line 22
Qualified LTC services are necessary
diagnostic, preventive, therapeutic, curing,
treating, mitigating, and rehabilitative services,
and maintenance or personal care services
required to treat a chronically ill individual under
a plan of care prescribed by a licensed health
care practitioner.

Line 24
Enter the reimbursements you received or
expect to receive through insurance or
otherwise for qualified LTC services provided
for the insured for LTC periods in 2022. Box 3 of
Form 1099-LTC should indicate if payments
were made on a reimbursement basis.

Instructions for Form 8853 (2022)

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Generally, don't include on line 24
reimbursements for qualified LTC
CAUTION services you received under a contract
issued before August 1, 1996. However, you
must include reimbursements if the contract
was exchanged or modified after July 31, 1996,
to increase per diem payments or
reimbursements.

!

Multiple Payees
If you checked “Yes” on lines 15 and 16 and the
only payments you received were accelerated
death benefits that were paid because the
insured was terminally ill, skip lines 17 through
25 and enter -0- on line 26.
In all other cases in which you checked
“Yes” on line 15, attach a statement duplicating
lines 18 through 26 of the form. This statement
should show the aggregate computation for all
persons who received per diem payments
under a qualified LTC insurance contract or as
accelerated death benefits because the insured
was chronically ill. Each person must use the
same LTC period. If all the recipients of
payments don't agree on which LTC period to
use, the contract period method must be used.
After completing the statement, determine
your share of the per diem limitation and any
taxable payments. The per diem limitation is
allocated first to the insured to the extent of the
total payments the insured received. If the
insured files a joint return and the insured's
spouse is one of the policyholders, the per diem
limitation is allocated first to them to the extent
of the payments they both received. Any
remaining limitation is allocated among the
other policyholders pro rata based on the
payments they received in 2022. The statement
showing the aggregate computation must be
attached to the Form 8853 for each person who
received a payment.
Enter your share of the per diem limitation
and the taxable payments on lines 25 and 26 of
your individual Form 8853. Leave lines 21
through 24 blank.

Example 1
A was chronically ill in 2022 and received 12
monthly payments on a per diem basis from a
qualified LTC insurance contract. A was paid
$2,000 per month ($24,000 total). A incurred
expenses for qualified LTC services of $150 per
day ($54,750) and was reimbursed for one-half
of those expenses ($27,375). A uses the equal
payment rate method and thus has a single
benefit period for 2022 (January 1–December
31). A completes Form 8853, lines 20 through
26, as follows.
Amount

Line
20

$24,000 ($2,000 x 12 months)

21

$142,350 ($390* x 365 days)

22

$54,750 ($150 x 365 days)

23

$142,350

24

$27,375 ($75 x 365 days)

25

$114,975

26

$ -0-

*$390 is the 2022 per diem limit for periodic
payments received under a qualified LTC insurance
contract. See Rev. Proc. 2021-45, section 3.61.

Instructions for Form 8853 (2022)

Example 2
The facts are the same as in Example 1, except
A's adult children, B and C, each also own a
qualified LTC insurance contract under which A
is the insured. Neither B nor C incurred any
costs for qualified LTC services for A in 2022.
From July 1, 2022, through December 31,
2022, B received per diem payments of $5,000
per month ($30,000 total) and C received per
diem payments of $3,000 per month ($18,000
total). A, B, and C agree to use the equal
payment rate method to determine their LTC
periods.
There are two LTC periods. The first is 181
days (January 1–June 30) during which the per
diem payments were $2,000 per month. The
second is 184 days (July 1–December 31)
during which the aggregate per diem payments
were $10,000 per month ($2,000 under A's
contract + $5,000 under B's contract + $3,000
under C's contract).
An aggregate statement must be completed
for the second LTC period and attached to A’s,
B's, and C's forms.
Step 1. They complete a statement for A for
the first LTC period as follows.
Line

Amount

Allocation ratio to C: 37.5% of the
remaining limitation ($17,235) is allocated to C
because the $18,000 C received during the
second LTC period is 37.5% of the $48,000
received by both B and C during the second
LTC period.
Step 4. A, B, and C each complete Form 8853
as follows.
A's Form 8853:
Line

1st LTC
Period

2nd LTC
Period

Form 8853

20

$12,000

$12,000

$24,000

25

$57,015

$12,000

$69,015

26

$ -0-

$ -0-

$ -0-

B's Form 8853:
Line

1st LTC
Period

2nd LTC
Period

Form 8853

20

$ -0-

$30,000

$30,000

25

$ -0-

$28,725

$28,725

26

$ -0-

$1,275

$1,275

C’s Form 8853:
1st LTC
Period

2nd LTC
Period

20

$12,000 ($2,000 x 6 months)

21

$70,590 ($390 x 181 days)

22

$27,150 ($150 x 181 days)

20

$ -0-

$18,000

$18,000

$70,590

25

$ -0-

$17,235

$17,235

24

$13,575 ($75 x 181 days)

26

$ -0-

$765

$765

25

$57,015

26

$ -0-

23

Step 2. They complete the aggregate
statement for the second LTC period as follows.
Line

Amount

20

$60,000 ($10,000 x 6 months)

21

$71,760 ($390 x 184 days)

22

$27,600 ($150 x 184 days)

23

$71,760

24

$13,800 ($75 x 184 days)

25

$57,960

26

$2,040

Step 3. They allocate the aggregate per diem
limitation of $57,960 on line 25 among A, B, and
C. Because A is the insured, the per diem
limitation is allocated first to A to the extent of
the per diem payments A received during the
second LTC period ($12,000). The remaining
per diem limitation of $45,960 is allocated
between B and C.
Allocation ratio to B: 62.5% of the
remaining limitation ($28,725) is allocated to B
because the $30,000 B received during the
second LTC period is 62.5% of the $48,000
received by both B and C during the second
LTC period.

-7-

Line

Form 8853