Did you receive an excess HSA contribution message? That is one reason that the code W amount would appear there.
Or is it the case that you have not completed the HSA interview?
According to IRS rules, the HSA contribution is considered taxable until you have answered the questions in the HSA interview about having qualifying HDHP (High Deductible Health Plan) health insurance.
Therefore, when you enter your W-2 with its code W amount in box 12, this amount is added to Other Income temporarily, and when you answer the HDHP coverage questions in the HSA interview, then, that amount is removed from Other Income and disappears from line 7 on form 1040.
Note: your code W amount is removed from Wages in boxes 1,3 and 5 by your employer before the W-2 is printed. This is how the code W amount is "deductible". Hence if the HSA contribution turns out to be taxable, it must be added back to your income.
**Say "Thanks" by clicking the thumb icon in a post
**Mark the post that answers your question by clicking on "Mark as Best Answer"
