Hsa form 1099-sa

[Burke]

TP receives distributions from HSA reported on this form, which flow through to 8889. He says he does not contribute to this account, but that his employer puts money in it. There is nothing on the W-2 detailing Employer Contributions. Is this required?

[kathyc2]

Yes, it is required. If it was me, because of the date, I'd go ahead and do the return, and then also print out the page of W-2 instructions for client to give to employer payroll department so they get it right next year. I've contacted many employers over the years that have not been reporting correctly.

[Burke]

I did just that last year, and he told me they had corrected it. Obviously, they didn't. The employer pays the health insurance as well, but that isn't on there either. (It may be optional?)

[BHoffman]

I wonder if your client is confused. Perhaps his HSA and health insurance is paid via a Cafeteria 125 plan, so he is paying for it but it wouldn't show up on his W2?

The DD reporting in box 12 for health insurance isn't mandatory until this year.

[kathyc2]

Reporting of DD code is optional for 2014 for employers with less than 250 W-2's.

The reporting of employer paid HSA contributions should have been reported w/ box W, but it would not affect clients tax liability. The main reason it's reported IMO is so employee knows how much more they can contribute if they wish to do so.

You may want to ask client for copy of check stub to verify that it's not coming out of their check after tax. Wouldn't be the first time someone does not understand their own pay/insurance.

[BP.]

HSA contributions should have been reported w/ box W. The main reason it's reported IMO is so employee knows how much more they can contribute if they wish to do so.

And that little phrase there has been the pink unicorn at the end of the rainbow!

When I see a "W" I see if they've paid in the max. If not, and especially if they are in AGI phase out ranges for various tax benefits, like SL interest, CTC, AOC, T&F deduction, then we've really been able to get a lot of leverage out of additional prior year HSA contributions. Sometimes people have only had to come up with just half the funds needed because the additional refund dollars (with lower taxes and maybe increased tax credits) supplies the rest. It has been amazing this year. I talk about HSAs all the time. People are getting them, but not sure how to get the very most out of them. Especially when they still come in with their little stack of (not-yet-HSA-reimbursed) medical bills to see if they can deduct them. What??

And people seem more amenable to PY HSA funding than PY IRA funding because most have some amount of on-going out of pocket medical expenses. It's been pretty fun.

[tpnl]

Last pay stub

Sometimes the information is on the last pay stub for the year. Some employers have a section that is "employer contributions" or something similar on the pay stub.

I have gotten the information there before when it is not on the W-2. But not all employers provide that information.

Sometimes there are no contributions for the year, but if there were monies left from previous years of contributions, there might only be distributions.

Kerrie

[Burke]

Exactly. And from what I learned in 2012, the employer was waaaayyy...overfunding. Whatever the medical bills were, that's what the employer was putting in the plan for the employee to pull out. The custodian bank could not explain why they were accepting those huge amounts. Also, there was some confusion about whether it was an HRA or HSA. The form she provided me this year was clearly marked "HSA."