This article provides an overview of how to add distributions reported on Form 1099-SA to a tax return.
About Form 1099-SA
Taxpayers should receive Form 1099-SA if they received any distributions from a Health Savings Account, Archer Medical Savings Account, or Medicare Advantage Medical Savings Account
Inquire if the taxpayer used all distributions for medical purposes
Distributions not used for medical purposes will be taxed on the taxpayer’s return
Information from here is reported on Form 8889 on the tax return
Entering 1099-SA Distributions on the Tax Return
Form 8889 may already be on the tax return, if the taxpayer made contributions to their HSA, and code “W” is entered on their W-2. If Form 8889 is already on the return, skip to step 4.
Select Add Form.
Locate Form 8889, and double-click to add the form.
If a joint return, choose New Taxpayer's or New Spouse's Occurrence.
Complete line 1a by indicating the coverage type as Self Only or Family.
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Complete lines 1b and 1c as needed.
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Enter the amount of distributions from the Form 1099-SA box 1 into Form 8889, line 14a (unless rolled over into another HSA).
Enter the amount of qualified medical expenses on line 15 (this will not be on the form you will need to ask the taxpayer).
*Failure to enter qualified medical expenses will result in the distribution being taxable.
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