Author Topic: HSA and insurance companies contribution-how to input on taxes?  (Read 268 times)

SomedayStache

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HSA and insurance companies contribution-how to input on taxes?
« on: February 11, 2018, 11:02:54 AM »
Hi all,

A portion of my monthly insurance premium is deposited by the insurance company into my HSA account ($1500 over the year).

I additionally made contributions in the amount of $5200 over the year through payroll deductions.  These payroll deductions show up on my W2 in box 12 (code W). 

The insurance company contribution of $1500 shows up nowhere on my W2 and I'm not sure where (or if) I need to input this amount on my taxes. 

SomedayStache

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Re: HSA and insurance companies contribution-how to input on taxes?
« Reply #1 on: February 11, 2018, 11:42:22 AM »
I'm pretty sure the $1500 should go on line 2 of form 8889?
https://www.irs.gov/instructions/i8889
"Include on line 2 only those amounts you, or others on your behalf, contributed to your HSA in 2017. Also, include those contributions made from January 1, 2018, through April 17, 2018, that were for 2017. Do not include employer contributions (see line 9) or amounts rolled over from another HSA or Archer MSA. See Rollovers, earlier. Also, do not include any qualified HSA funding distributions (see line 10). Contributions to an employee's account through a cafeteria plan are treated as employer contributions and are not included on line 2."

The tricky part is figuring out which question to answer in the software to get that number to show up there.  I've figured it out in TurboTax and now freetaxusa.

terran

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Re: HSA and insurance companies contribution-how to input on taxes?
« Reply #2 on: February 11, 2018, 11:59:48 AM »
That is where HSA contributions go, but line 2 results in a tax deduction, so that doesn't seem like what "should" happen since you presumably already had your income reduced by the insurance premiums, so you'd essentially be getting that deduction twice.

SomedayStache

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Re: HSA and insurance companies contribution-how to input on taxes?
« Reply #3 on: February 11, 2018, 12:11:27 PM »
Yep - you are right.  Once I followed things through to the end that is what happened and it doesn't make sense that way.

So now I'm back to wondering where (if anywhere) that $1500 shows up on the taxes?

MDM

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Re: HSA and insurance companies contribution-how to input on taxes?
« Reply #4 on: February 11, 2018, 01:21:53 PM »
Yep - you are right.  Once I followed things through to the end that is what happened and it doesn't make sense that way.

So now I'm back to wondering where (if anywhere) that $1500 shows up on the taxes?
If the insurance premium is pre-tax and through your employer, then "Contributions to an employee's account through a cafeteria plan are treated as employer contributions and are not included on line 2" likely applies.

If the insurance premium is post-tax, then line 2 of form 8889 is correct.

SomedayStache

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Re: HSA and insurance companies contribution-how to input on taxes?
« Reply #5 on: February 11, 2018, 01:49:29 PM »
They are pre-tax and shouldn't show up on line 2.  OPM tells me that "Premium pass through" payments are not considered income, and you can not deduct them on your income tax return."

Should I add this $1500 pass through contribution to line 9 (Employer contributions) even though my W2, box 12, code W only reflects $5200?  It doesn't change anything overall in the end if the number on line 9 is $5200 or $6700...so I'm probably way overthinking this.

MDM

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Re: HSA and insurance companies contribution-how to input on taxes?
« Reply #6 on: February 11, 2018, 02:31:41 PM »
They are pre-tax and shouldn't show up on line 2.  OPM tells me that "Premium pass through" payments are not considered income, and you can not deduct them on your income tax return."

Should I add this $1500 pass through contribution to line 9 (Employer contributions) even though my W2, box 12, code W only reflects $5200?  It doesn't change anything overall in the end if the number on line 9 is $5200 or $6700...so I'm probably way overthinking this.
See HSA premium pass-through and form 8889 - TurboTax Support for one answer.