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Tax Information for 2011 HSA Owners

 

If you had a Health Savings Account (HSA) in 2011, you will need to include certain information on your 2011 Federal income tax filing.

 

Tax FormIRS Forms 1040 and 8889

You will need to report HSA contributions and distributions on Federal Form 8889. After you have completed Form 8889, you report the calculated deduction as adjusted gross income on Form 1040. View 8889 Instructions and 8889 Form. 

 

IRS Form 5498-SA

In order to complete form 8889, you should refer to your W-2 to report contributions made through payroll deduction.  Note that both your contributions and the employer rebate made through payroll deduction on a pre-tax basis are considered employer contributions for income tax purposes. You must also include any contributions you made directly to PayFlex outside of payroll deductions. You will receive Form 5498-SA from PayFlex in May 2012.  Keep this form with your income tax records. Visit the IRS web site for more information about Form 5498-SA. (www.irs.gov)

 

IRS Form 1099-SA

PayFlex will mail Form 1099-SA, reflecting withdrawals from your account during 2011, no later than Jan. 31, 2012.  You need to report this amount on Form 8889. Any distributions must be for a qualified health cost in order to be non-taxable (See IRS publication 502). You should keep all receipts for eligible expenses corresponding to HSA withdrawals with your tax records. Visit the IRS web site for more information about Form 1099-SA. (www.irs.gov)

 

If you contributed more than the maximum or made withdrawals for non-qualified expenses, those funds may be subject to taxation or penalties. Please see your tax advisor if you have any questions.

 

This article is informational only regarding Federal tax obligations for HSA account holders and is not intended to be tax advice. State income tax rules for HSAs vary.  Please refer to your tax specialist or state laws and forms for instructions on how to file.