*Peggy Walker, age 48, is a single parent raising her son, Marcus

*Marcus is a full-time student and had no income

*Peggy quali es to le as Head of Household.

*For the last ve years, Peggy has had family health coverage through a High Deductible Health Plan (HDHP) from her employer

*Peggy has had an HSA for several years

*In 2017, she contributed $1,500 to her HSA

*Peggys grandmother helped her out and contributed $1,000 to her HSA in 2017

*Peggys employer also contributed $600 to her HSA in 2017

*Peggy paid the following expenses in 2017 using money from her HSA:

Urgent care bill for Peggy - $615

Prescription medicine for Peggy - $200

Insulin for Marcus - $140

Health club fees for Peggy - $175

Doctor visits for Marcus - $500

Peggy and Marcus are U S citizens and have valid Social Security numbers

1.The amount Peggy Walker will report on her Form 8889, line 13 is:

a $600

b $1,500

c $2,500

d $3,100

2. Peggy Walkers total income includes a taxable HSA distribution of $315

a True

b False

3. Which expense is not reported on Form 8889, line 15?

a Insulin

b Doctors visit

c Health club fees

d Prescription medicine

4.Peggy must pay an additional 20% tax on the portion of her HSA distribution that was not used for unreimbursed quali ed medical expenses.

a True

b False