Do I need to separate contributions to 2 different HSA

[kranig]

I have an HSA through my company, which I contribute to via payroll deductions. I also have a separate HSA that I started independantly that I just contribute to outside of payroll monthly. Do I need to distinguish between the 2 when entering the total HSA contribution in Turbo Tax or just sum them together and enter 1 contribution? (assume I am less than the $7750 max allowed for married filing jointly).

[TomK2023]

Do not simply add them together.  

Usually, your HSA contribution is reported in box 12 of your W-2 with the code W (Company Contributions to Health Savings Account). TurboTax automatically records this amount in the 1099-SA, HSA, MSA section.

Code W reports the combined HSA contributions from you and your employer. So if you contributed $1,500 to your HSA and your employer matched it dollar for dollar, box 12 on your W-2 would show $3,000 with a code W.

You can also contribute directly to your HSA and get a tax deduction. This is uncommon for employees who make pre-tax contributions at work, but is more common for self-employed or unemployed taxpayers who have an HSA.

Here’s how to enter a post-tax HSA contribution in TurboTax:

1. Open (continue) your return in TurboTax.
2. In the search bar, search for hsa and select the Jump to link in the search results.
3. On the screen Tell us about the health-related accounts you had in 2023, check the box next to Health Savings Account (HSA) and select Continue.
   • If you land on Your HSA summary, select Edit, then make sure the Health Savings Account (HSA) box is checked on the next screen and select Continue.
4. If you see the screen Here’s what we have so far, select Done.
5. Answer Yes or No to Did you inherit this HSA?, depending on your situation.
6. Enter your contribution on the screen Let’s enter your HSA contributions and select Continue.
7. If you contributed too much, you'll see the message You may want to withdraw funds from your HSA. Select the option to either withdraw the excess or pay the penalty.
8. Continue answering the questions until you reach Your HSA summary. All your employee contributions will be listed as a deduction, and any contributions made by your employer and not reported on your W-2 will be reported as tax-free company contributions.

[kranig]

I believe I understand your reply, however, it's not exactly my situation. I am not asking if I need to separate what I contributed in excess to the same HSA I have through my employer. Those numbers I have correct (what my employer contributed via my W2 and what I contributed in excess via external contributions - via the "Let's enter Derek's HSA contributions" screen in Turbo Tax). What I'm really after is the contributions I made to a different HSA...NOT the employee sponsered/provided one. I contributed via payroll deductions to the employer HSA (reported on my W2), contributed extra to that same HSA (reporting in TurboTax on the "Let's enter Derek's HSA contributions" screen), AND I contributed to a DIFFERENT HSA (not employer sponsered) a small amount. The only field I found to add "any contributions personally made" is the same screen mentioned above ("Let's enter Derek's HSA contributions"). So...I added all extra contributions (2 separate HSA accounts) in that field. I'm uncertain if I need to distinguish between the 2 individual HSA accounts is all.

[BillM223 · Accepted solution]

No, just pretend that you have a single virtual HSA for purposes of your tax return. One limit for the the two HSAs, and all contributions are going to the "virtual" HSA. 

I am not sure why you have two HSAs (although there is nothing wrong with that); is it that the employer's HSA doesn't invest as well as the second one you have? If so, remember that once a year you can "roll over" the amount from your employer's HSA to your other HSA.

[dmertz]

The one-rollover-per-12-months limitation only applies to distributions and rollovers.  There is no limitation on nonreportable trustee-to-trustee transfers of HSAs where one HSA trustee sends the fund directly to the other HSA trustee.

[kranig]

You are correct, there is/was no need for 2 HSA's, however the company sponsored offering did not invest in the market, they simply "stored" the money for use later. I wanted the money to "earn/grow" so I created a second HSA that had investment options. Thank you for your clarification/information.