I change careers and had to withdrawl my HSA and retirement. Should I receive a form in the mail to help me complete the 8889T form? If so, what will that form say?

[BMcCalpin · Accepted solution]

If you change insurance coverage so that you are no longer covered by a High Deductible Health Plan (HDHP) which frequently happens with a change of job, then you still can have the HSA and the money in it - you just can't contribute to the HSA any longer. But you can spend the money out of the HSA for qualified medical expenses until the HSA is exhausted.

Put another way, the HSA - like an IRA - is yours and not your employer's and can move with you from job to job.

I cannot tell from your question, but did you actually withdraw any money from the HSA? If you took any distributions from the HSA, you should have already received a form 1099-SA in the mail describing that distribution. You would use this form to help complete the 8889 in the HSA interview (Federal->Deductions & Credits->Medical->HSA, MSA Contributions).

If you took money out for non-medical purposes, then not only will you pay income tax on the amount, but you will pay a 20% penalty. It would be far better to leave the money in the HSA and use it only for medical expenses.

If you did not take any HSA distributions (pay for medical expenses) in 2017 and you did not (you or your employer) did not make any contributions to the HSA (normally shows up on your W-2 in box 12 with a code of W), then you do not have to file form 8889.

[trennikat]

I didn't take money out of the HSA they said I have an excess amount and need to withdraw it. I was told my HSA money was only my card and I only use that for medical purposes. However, I did withdraw my IRA but I ask them to subtract the taxes, fees, and penalty before hand. The 8889 is asking what months I was covered and who was covered and I was able to fill that in simply because I know what months I was covered. However, there are other portions on the form that I am not sure where to retrieve the information. The 1099-SA was received in the mail and I input the information, but it is still saying that there is something incorrect.

[BMcCalpin]

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