Death Beneficiary Issues. You understand that if you designate your spouse as primary death beneficiary or contingent death beneficiary of this HSA, the dissolution, termination, annulment or other legal termination of your marriage will automatically revoke all beneficiary designations, both primary and contingent. After such revocation and until such time as a new beneficiary designation is completed, the HSA shall be treated as if there is no beneficiary designated If you die and your death beneficiary is your current spouse, your HSA shall become your spouse’s HSA as of the date of your death. If the death beneficiary is your ex-spouse and you have not completed a new beneficiary designation since the termination of your marriage to your ex-spouse, then this HSA shall be treated as if there is no death beneficiary (primary or contingent) and the entire HSA shall be treated as if your estate is the death beneficiary. If your death beneficiary is not your current spouse (which would include your ex-spouse if you completed anew beneficiary designation after the termination of your marriage to your ex-spouse), the value of your HSA on your date of death will be taxable to your death beneficiary in the year you die and your HSA (or the relevant portion thereof) will cease to be an HSA as of the date of death. If the death beneficiary is your estate or you do not have a death beneficiary, the fair market value of the account as of the date of death is taxable on Accountholder’s final return. For other death beneficiaries, the fair market value of the account is taxable to that person in the tax year that includes such date.
