topic HSA Contribution from Health Insurance Company in Get your taxes done using TurboTax

HSA Contribution from Health Insurance Company

Katej1213 — Mon, 09 Mar 2026 06:26:33 GMT

Hi there! I participate in the UHC Motion program though my health insurance company (UnitedHealthcare) which allows me to earn money by hitting different fitness goals every day (FIT credits) that add up as wellness contributions on a quarterly basis. Every quarter, UHC Motion transfers those wellness contributions (FIT credits) directly to my HSA. The wellness contributions from UHC Motion are not included on my W-2, but they do show on my 5498-SA.

Do I need to include the wellness contributions from UHC Motion on my personal tax return? If so, which section do I need to include them under?

Thank you in advance for any assistance!

Re: HSA Contribution from Health Insurance Company

dmertz — Thu, 03 Feb 2022 23:10:40 GMT

This sounds like something that you would report as miscellaneous income and as a personal HSA contribution. The deduction for the HSA contribution would offset the miscellaneous income so there would be no change in your AGI, but the entry of the HSA contribution is necessary for Form 8889 to be prepared correctly.

Alternatively you could indicate that your employer told you about this amount of HSA contribution and that the employer did not include it on your W-2. The taxable result would be the same as above but the reporting of the amount would be on Form 8889 line 9 instead of line 2 and there would be no miscellaneous income to report or any HSA deduction.

Re: HSA Contribution from Health Insurance Company

Katej1213 — Fri, 04 Feb 2022 14:00:13 GMT

So my fear with doing it the first way you suggested is that I'm afraid I will enter the information incorrectly within TurboTax. I may just have to do the option where I can talk to an expert, but I am worried that they may not know either because I really can't find any information on this type of contribution.

My question about reporting it the second way you suggested is this: would these contributions be considered an "employer contribution" because the credits that I earn by hitting goals each day are distributed on a quarterly basis directly from UnitedHealthcare Motion to my HSA account?

Re: HSA Contribution from Health Insurance Company

dmertz — Fri, 04 Feb 2022 17:36:38 GMT

It's probably more correct to report it the first way, but either way results in no change to your AGI and the sum of Form 8889 lines 2 and 9 agreeing with your Form 5498-SA.

Re: HSA Contribution from Health Insurance Company

Katej1213 — Fri, 04 Feb 2022 18:59:01 GMT

I definitely understand what you're saying about reporting it the first way, and I do agree that that would be a better way to report it.

On one of the brochures for UHC Motion, it says:

"Balance transfers: Once each quarter, members' earnings are transferred to their HSAs. Earnings distribution: Think of the quarterly transfers as their distributions."

I think this means, as you said, that I should treat it like my own contribution? The use of "distribution" there confuses me. I have attached the full page for review.

Re: HSA Contribution from Health Insurance Company

dmertz — Sat, 05 Feb 2022 03:04:46 GMT

It appears that "distribution" is referring to a distribution from the UnitedHealthcare Motion account (which is then directed to the HSA as a personal contribution), certainly not a distribution from the HSA.

Re: HSA Contribution from Health Insurance Company

Katej1213 — Sun, 06 Feb 2022 03:30:23 GMT

Yes I agree with that - I think the wording is just a bit confusing since it definitely wouldn’t be an HSA distribution (definitely a distribution by UHC). After further research, I think I should just count it as my own personal contribution (based on the brochure I posted above and the other info I’m sharing in this post). It states that I should claim any contribution made by “others” or “anyone on my behalf,” and I don’t think I need to claim it as income. I also read through a publication published by the IRS and it said the same thing, and I stumbled upon another Intuit post where it said to simply claim as my own contribution. So I think I’m good now and understand what to do!

Re: HSA Contribution from Health Insurance Company

dmertz — Sun, 06 Feb 2022 12:21:18 GMT

If you paid for the health insurance with after-tax money (and did not claim a deduction for the health insurance premiums), this money would probably just be considered to be a nontaxable return of premium. However, if the health insurance was paid for with before-tax money or you claimed a deduction for this amount, I think it would be taxable income. Getting money back that you never paid tax on and then claiming a deduction for putting this money into an HSA would be double dipping.

Re: HSA Contribution from Health Insurance Company

Katej1213 — Sun, 06 Feb 2022 14:58:01 GMT

That part is not clear to me because my employer pays health insurance premiums if you are the only one covered under the plan (e.g., my husband and I have insurance through our respective employers so I don’t pay anything for mine, but if I were to have a family plan my company would only pay a portion).

I still feel like based on what the Blackhawk Bank information was saying is that a benefit of if someone else puts money in is that I still get to claim it to offset my income?

Re: HSA Contribution from Health Insurance Company

Katej1213 — Sun, 06 Feb 2022 16:16:59 GMT

I also found this which makes it seem like I’m supposed to claim:

Re: HSA Contribution from Health Insurance Company

dmertz — Sun, 06 Feb 2022 18:38:52 GMT

Since you didn't pay tax on the money that ended up in the HSA, you don't get a deduction for this HSA contribution. It appears that the HSA is effectively being funded from the premiums paid by your employer (equivalent to a discount on the premiums paid by your employer and an HSA contribution by your employer), so I don't think that I see any problem reporting it as an HSA contribution made by your employer that was not reported on your W-2, resulting in it being included on Form 8889 line 9 instead of line 2 and no need to include it as miscellaneous income.

Re: HSA Contribution from Health Insurance Company

Katej1213 — Sun, 06 Feb 2022 23:01:23 GMT

But the HSA is not being funded by premiums when it comes to the wellness contributions. I have to meet certain fit goals each day to earn the money that becomes my wellness contributions each quarter from UnitedHealthcare Motion (I have 3 goals each day and each goal is worth $1 when met, so I get a maximum of $3 per day when goals are hit). If I don’t meet the goals and earn the money myself, $0.00 goes into my HSA.

I don’t understand how these contributions wouldn’t be included on line 2, since that is where any contributions on my behalf are supposed to go (whether or not they are made by me or anyone other than my employer). This has really become such a headache over such a small amount of money.

Re: HSA Contribution from Health Insurance Company

Katej1213 — Sun, 06 Feb 2022 23:28:14 GMT

Sorry for double responding again, but

I also found this in searching on Cigna’s incentive information.

Re: HSA Contribution from Health Insurance Company

RobertB4444 — Mon, 07 Feb 2022 00:23:34 GMT

@Katej1213 Your insurance company is paying you to work out. If you get paid to do a thing then it is taxable income. The IRS expects you to report 100% of taxable income.

@dmertz is right - you can't take a deduction for the money that is contributed to your HSA account if you haven't paid tax on it. So you need to first enter it as taxable income and THEN it can be a deduction.

Re: HSA Contribution from Health Insurance Company

Katej1213 — Mon, 07 Feb 2022 00:42:54 GMT

Okay, thank you for your assistance! So I will include the wellness contribution incentive payment total as income and then include it as my own contribution (line 2) of the Form 8889 to offset that income… now my question is which section in TurboTax am I supposed to use for the income from the UHC wellness incentives since I don’t have a tax form that it corresponds to?

I didn’t think it would be right to include under my employer’s contribution but am not sure where to put it then.

Re: HSA Contribution from Health Insurance Company

dmertz — Mon, 07 Feb 2022 00:47:58 GMT

@Katej1213 , I'll just refer you back to my original post for the two possible ways to report this to get the correct taxable result. If you want it to be on line 2 of Form 8889 as a deductible HSA contribution, you'll also need to report it as miscellaneous income.

Re: HSA Contribution from Health Insurance Company

Katej1213 — Mon, 07 Feb 2022 14:52:49 GMT

Okay, I think I am understanding better now.

For some reason I was thinking I got a tax benefit for the money going directly into the HSA from UHC Motion rather than getting like a gift card, etc. Which I guess I still do get a tax benefit because I get to claim those UHC Motion contributions as income AND my personal contributions so it's basically a wash, rather than just having to claim as income (without claiming as a personal HSA contribution).

Thanks for your help!

Re: HSA Contribution from Health Insurance Company

Katej1213 — Fri, 18 Feb 2022 20:41:12 GMT

@dmertz @RobertB4444 I decided to follow up with UHC Motion directly to find out whether the contributions from UHC are considered employer contributions or not, and they are considered employer contributions. My employer told me originally not to include these contributions and to just put what is on my W-2, but I think I should add these contributions from UHC on Line 9 (with employer contributions) of Form 8889 anyway. Thoughts?

Re: HSA Contribution from Health Insurance Company

BillM223 — Fri, 18 Feb 2022 21:26:46 GMT

"they are considered employer contributions. "

Well, yes and no. The employer is apparently making the contribution, but the employer contribution is normally listed as the amount with code W in box 12 of the W-2. Your employer apparently does not want to add this amount to the code W (or maybe they don't know what it is).

So the way you could handle this is to go into the HSA interview (do a Search (upper right) for hsa (Mac users must look for hsa in the Topics list). Just enter hsa and hit Enter - ignore all the suggested search terms.)

In the HSA interview, you will see a screen that says, "Let's enter [name]'s HSA contributions". Please do NOT enter your wellness contributions here.

The next screen should ask if your employer told you about any other contributions. Ignore the comment about being from a previous year, and click on YES.

Three new lines are exposed. In the last line "Employer and payroll contributions not reported in box 12 of your W-2", enter the total of your wellness contributions. Continue and finish the HSA interview.

I believe this amount will be added to the code W amount and be placed on line 9 of your 8889. As dmertz has noted, there will be no change to your AGI or tax.

If you did what dmertz initially suggested (add the amount as Miscellaneous income and then enter it as a personal contribution on that first screen I referred to above), then the effect would be exactly the same, except that this wellness amount would appear on line 2 and not line 9 on the 8889.

I can't call either method as "better" because they both result in exactly the same outcome.

Re: HSA Contribution from Health Insurance Company

Katej1213 — Fri, 18 Feb 2022 21:42:15 GMT

@BillM223Thank you so much for your feedback! Your instructions and explanation of both methods creating the same result was very insightful.

I think the reason my employer doesn’t add these contributions to my W-2 is because since each dollar has to be earned by me hitting the fitness goals, they don’t know what the earned amounts are (because it won’t always be the same). I just don’t understand why they told me not to add these contributions to my return at all. So you think that as long as I add the contributions via either method that you and dmertz mentioned that it shouldn’t cause any issues with my return?