PUBLIC LAW 104-191—AUG. 21, 1996 110 STAT. 2043 "(i) such distribution is received by the individual on or before the last day prescribed by law (including extensions of time) for filing such individual's return for such taxable year, and "(ii) such distribution is accompanied by the amount of net income attributable to such excess contribution. Any net income described in clause (ii) shall be included in the gross income of the individual for the taxable year in which it is received. I "(B) EXCESS CONTRIBUTION.—For purposes of subpara^ graph (A), the term 'excess contribution' means any con|- tribution (other than a rollover contribution) which is nei^ ther excludable from gross income under section 106(b|) nor deductible under this section. "(4) ADDITIONAL TAX ON DISTRIBUTIONS NOT USED FO^I QUALIFIED MEDICAL EXPENSES.— "(A) IN GENERAL.—The tax imposed by this chapter on the account holder for any taxable year in which there is a payment or distribution from a medical savings account of such holder which is includible in gross income under paragraph (2) shall be increased by 15 percent of the amount which is so includible. " (B) EXCEPTION FOR DISABILITY OR DEATH.— Subparagraph (A) shall not apply if the payment or distribution is made after the account holder becomes disabled within the meaning of section 72(m)(7) or dies. " (C) EXCEPTION FOR DISTRIBUTIONS AFTER MEDICARE ELIGIBILITY.— Subparagraph (A) shall not apply to any pay- ment or distribution after the date on which the account holder attains the age specified in section 1811 of the Social Security Act. "(5) ROLLOVER CONTRIBUTION. — An amount is described in this paragraph as a rollover contribution if it meets the requirements of subparagraphs (A) and (B). "(A) IN GENERAL. — Paragraph (2) shall not apply to any amount paid or distributed from a medical savings account to the account holder to the extent the amount received is paid into a medical savings account for the benefit of such holder not later than the 60th day after the day on which the holder receives the payment or distribution. "(B) LIMITATION.— Th is paragraph shall not apply to any amount described in subparagraph (A) received by an individual from a medical savings account if, at any time during the 1-year period ending on the day of such receipt, such individual received any other amount described in subparagraph (A) from a medical savings account which was not includible in the individual's gross income because of the application of this paragraph. " (6) COORDINATION WITH MEDICAL EXPENSE DEDUCTION.— For purposes of determining the amount of the deduction under section 213, any payment or distribution out of a medical savings account for qualified medical expenses shall not be treated as an expense paid for medical care. "(7) TRANSFER OF ACCOUNT INCIDENT TO DIVORCE.— The transfer of an individual's interest in a medical savings account
�
