AB 639

Under current federal law, certain individuals may make tax-deductible

contributions to health savings accounts (HSAs) and withdraw the money tax-free

when needed to cover routine and preventive medical care.

Under this bill, an individual who makes contributions to such an HSA may

claim a nonrefundable income tax credit for 6.5 percent of the allowable amount that

the individual claims as a federal tax deduction for a contribution to an HSA or 6.5

percent of the federal tax-exempt earnings relating to an HSA, or both. The credit

may not be claimed, however, by a single person, head of household, or married

person who files a separate return if the person's Wisconsin adjusted gross income

(AGI) exceeds 500 percent of the federal poverty level, or AGI in excess of 500 percent

of the federal poverty level in the case of a married couple who files a joint return.

The bill first applies to taxable years beginning on January 1, 2011.