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  1. #1
    Join Date
    Sep 2010
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    21

    Question How to Complete IRS Form 8889, Health Savings Account

    I am older than 60 and contributed X dollars to the health savings account that is an employee benefit.
    I used all of the money to pay medical bills.
    The HSA contribtution is pre-tax. I filled out a form each time I put money in the HSA. This form directed my employer made a pre-tax deduction from my paycheck to put the money in the HSA.
    The amount that I put in the HSA is not included in the wages on the W-2 because it was pre-tax.
    I received Form 1099-SA from the Health Savings Account. It lists an amount as a "gross distribution" in box #1.
    The distribution code in box 3 is 1.
    I do not know what to do with this form and whether I need to fill out IRS Form 8889.
    On form 8889 -
    Box 2 asks for the amount of contributions made. Do I fill in the amount that was contributed pre-tax or does this only apply if the contributions weren't pre-tax?
    Item 7 asks something about HDHP for people older than 55. I assume this means High Deductible Health Plan. So I entered my premium payments for the year.
    My amount on line 8 is Z.
    Item 10 asks for qualified distributions. I don't know what that means.
    If I put the amount from Form 1099-SA, I get Y.
    My amount on line 10 is Y, which is greater than X. Maybe that is because interest was earned on X, so I could spend Y on the medical bills.
    If I subtract line 11 from line 8 I get a negative number, so I list zero according to the instructions.
    Line 13 is the smaller of lines 2 and 12, so it is 0.
    Then there is a caution statement that says that if line 2 is greater than line 13, tax may be due.
    I thought the purpose of the pre-tax contribution was that it is not taxable.

    Then in Part II they ask for the total distributions. Then they ask for unreimbursed qualified medical expenses. So I have amount Y for lines 14a, 14c and 15.
    Is everything filled out right?
    Thanks for the help.

  2. #2
    Join Date
    Sep 2010
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    9,270

    Default Re: How to Complete IRS Form 8889, Health Savings Account

    If the money came out of your wages before taxes on the W-2 you don't have to submit an 8889 at all. That's only if you decide to make a contribution with money you've received after tax.

  3. #3
    Join Date
    Sep 2010
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    21

    Default Re: How to Complete IRS Form 8889, Health Savings Account

    Thank you. What do I do with the 1099 SA form I received? Do I submit it with the tax return or just keep it for my own records?

  4. #4
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    Sep 2010
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    Default Re: How to Complete IRS Form 8889, Health Savings Account

    Keep it for your own records.

  5. #5
    Join Date
    Oct 2006
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    5,217

    Default Re: How to Complete IRS Form 8889, Health Savings Account

    Quote Quoting flyingron
    View Post
    If the money came out of your wages before taxes on the W-2 you don't have to submit an 8889 at all. That's only if you decide to make a contribution with money you've received after tax.
    Sorry Ron but I completely disagree. Form 8889 is needed to show that the distributions were used for qualified medical expenses. Otherwise the distributions are taxed. OP will get a CP-2000 letter about 8 months from now asking for tax on the distribution if his/her return does not include the form.

    OP, if you cannot figure out how do fill out the form by reading the instructions, then unfortunately you probably should not be doing your own tax return, or at least should not be attempting to do it manually. Try using software and if you still cannot do it right, then see a tax professional.

  6. #6
    Join Date
    Sep 2010
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    21

    Default Re: How to Complete IRS Form 8889, Health Savings Account

    Thank you for the advice.
    So does this mean I should submit the 8889 and 1099SA? Then I still have to know how to fill it out. I don't want to spend money on software or an accountant and there is no guarantee that the software will be clear or ask the right questions.
    Any advice on how to fill out the forms is most appreciated.

  7. #7
    Join Date
    Jul 2007
    Location
    Florida
    Posts
    1,782

    Default Re: How to Complete IRS Form 8889, Health Savings Account

    You file 8889 with your tax return. You do not file the form 1099-SA. If you cannot understand how to fill out the form from the instructions provided by the IRS and you do not want to spend any money to get help elsewhere I can't see how you're going to complete your tax return. The IRS hires people expert in writing instructions that interpret and help people comply with the tax code. Nobody here is going to be able or willing to write out instructions more understandable to you than the IRS has provided.

  8. #8
    Join Date
    Sep 2010
    Posts
    21

    Default Re: How to Complete IRS Form 8889, Health Savings Account

    The purpose of this thread is to learn how to complete these forms and which forms need to be filed. If your reply does not contain such information, please to not clutter this thread with replies that are not useful. Specifically, please do not post a reply saying that no one is going to reply. That is not constructive. Please do not post replies that assume that people can understand the IRS terminology. I do not understand terms like "distribution" and "qualified distribution." I do not know how the IRS determines that a distribution was for medical advances and not a withdrawal to use the money for other purposes. I understand terms like "money used to pay medical bills," "money I deposited in the account," etc. I do need to have all of this explained in plain English. When they say enter your qualified distributions I have no idea what is being calculated and what they are talking about.

  9. #9
    Join Date
    Jul 2007
    Location
    Florida
    Posts
    1,782

    Default Re: How to Complete IRS Form 8889, Health Savings Account

    Until you are elected the board's censor please do not tell me when or what to post and you can keep your lectures to yourself when you're asking people for free help. If you have a specific question, I will be happy to help you as I have done for many many people on this board. But a general "I don't know how to fill out the form" is not a question.

    There are instructions to all IRS forms and there are IRS publications, such as IRS Pub. 969. If you read that information and cannot understand it, then ask a specific question. If you cannot formulate a question that a knowledgeable person such as myself can address then you will have to pay for help. All of the information you are seeking is in IRS Pub. 969 so start there. It explains all those terms you're asking about. But we have no way of knowing what all you don't know or don't understand until you ask. If you don't like my answer, maybe another board member here can give you a better one. You seem to expect a lot, including reading your mind as to what you don't understand, for free.

  10. #10
    Join Date
    Oct 2006
    Posts
    5,217

    Default Re: How to Complete IRS Form 8889, Health Savings Account

    Quote Quoting JQx5Rc9
    View Post
    The purpose of this thread is to learn how to complete these forms and which forms need to be filed. If your reply does not contain such information, please to not clutter this thread with replies that are not useful. Specifically, please do not post a reply saying that no one is going to reply. That is not constructive. Please do not post replies that assume that people can understand the IRS terminology. I do not understand terms like "distribution" and "qualified distribution." I do not know how the IRS determines that a distribution was for medical advances and not a withdrawal to use the money for other purposes. I understand terms like "money used to pay medical bills," "money I deposited in the account," etc. I do need to have all of this explained in plain English. When they say enter your qualified distributions I have no idea what is being calculated and what they are talking about.
    Do you honestly think that any of the volunteers here are going to take the time to walk you through filing out a tax form? No one has that much time to give to one poster, nor would it be something that anyone could do with any degree of efficiency writing back and forth.

    You are either going to have to figure it out from the instructions, pay a professional to do it for you, get software, or find some volunteer somewhere who can actually sit down with you.

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