Angie starts a new job on July 1 and becomes covered under the employer's health insurance plan which has an annual deductible of $2,400. Angie contributes the maximum amount into a Health Savings Account. Which of the following statements regarding Angie's Health Savings Account is correct?
A) Angie can contribute and deduct $1,200 for AGI.
B) Angie's contribution will be deductible if she itemizes, and the contribution along with her out-of-pocket medical expenses exceed 7.5% of AGI.
C) If Angie withdraws $500 to pay for X-rays, the $500 is taxable.
D) Interest income earned on the HCA is taxable.
A) Angie can contribute and deduct $1,200 for AGI.
She was covered under the HDHP for 6 months so HCA contributions up to $1,200 are deductible, and they are deductible for AGI.
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