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Deductions & credits
An HSA Funding Distribution (HFD) comes first from the pre-tax money in your IRA, so if you have a sufficient amount of pre-tax money in your traditional IRA to fund the HFD, the distribution comes entirely from pre-tax money. HFDs are not reported on Form 8606. If you have too little pre-tax money in the IRA to be applied to the HFD, do as TurboTaxBillMc suggests and claim only enough as HFD so that the taxable amount of the distribution calculated on Form 8606 is reduced to zero as a result of the calculation on Form 8606 showing that the remainder of the distribution was entirely from your after-tax basis in traditional IRAs. (If, fact, I think it is impermissible to claim an HFD of more than the amount that would otherwise be taxable if you distributed all of your IRA funds during the year in which you make the HFD.) Then report that remainder as a deductible HSA contribution.
‎June 1, 2019
10:52 AM