topic Fall of 2020 moved about $2400 from an IRA into HSA got a 1099-R. now find I can't put money into HSA since I no longer have hi ded insur - What should I do with that $? in Deductions & credits

Fall of 2020 moved about $2400 from an IRA into HSA got a 1099-R. now find I can't put money into HSA since I no longer have hi ded insur - What should I do with that $?

bbmansfield — Fri, 05 Mar 2021 17:39:47 GMT

I am 61, should i just keep the money as cash? Put it into an IRA?

Re: Fall of 2020 moved about $2400 from an IRA into HSA got a 1099-R. now find I can't put money ...

BillM223 — Sat, 06 Mar 2021 02:34:31 GMT

So you received the distribution from the IRA administrator and haven't done anything with it yet?

You had HDHP coverage in 2020, right? Did you max out your HSA contributions for 2020? If not, you can contribute some or all of the distribution to your HSA for tax year 2020.

Four caveats:

1. This contribution when added to other 2020 contributions must not exceed your HSA contribution limit for 2020.

2. You will have to enter this as a personal (direct) contribution on your 2020 tax return.

3. You must make sure that the HSA custodian knows that it is for 2020 (otherwise, they will default to 2021).
4. You have to do this before April 15, 2021, unless you extend your return.

If this does not work for you, then you can look at your eligibility to make an IRA contribution - we don't have enough information from you on whether you can or not.

Re: Fall of 2020 moved about $2400 from an IRA into HSA got a 1099-R. now find I can't put money ...

dmertz — Sun, 07 Mar 2021 18:52:26 GMT

If you were not eligible to make this HSA contribution for 2020, the distribution from the IRA must be treated as an ordinary distribution from the IRA (reported as not transferred to an HSA) and separately treated as a personal, excess contribution to the HSA.