Employer Error in HSA Box 12

[bluetrumpet]

For 2023 for the first months of the year my employer deducted the HSA from my pay but in error did not reduce my taxable income by that amount. On my W2 Box 12 shows ~$3500, and it should have been ~$4700.
The total amound of the HSA is correct.

Is this something that I can correct in Turbotax? My former employer is not easy to deal with. 

Thanks!

[BillM223 · Accepted solution]

Open your return in TurboTax and go back to the HSA interview (Deductions and Credits->Medical->1099-SA, HSA, MSA ** note wording may vary from product to product). Do the following:

In the box where the arrow is pointing, enter the amount that is missing from the code W ($1,200 from your description).

This will place the missing amount in your 8889 and apply it to your return. This will show up as Tax-free employer contributions in the HSA Summary at the end of the HSA interview.

[bluetrumpet]

This looks very promising!!! I'll try tomorrow and report back!

[BillM223]

If you have the desktop product, you will see this difference appear on line 9 Employer Contribution Smart Worksheet on line 9(E).

Or you will see the Line 9 amount change to the $4,700 you reported.

[Mike9241]

were box 1 wages reduced $3500 or $4700.  if $3500, the method provided won't give you the missing deduction of $1200. it would only adjust box 9 of the 8889.  If box 1 was only reduced by $3500 you need a corrected w-2 otherwise you'll pay taxes on that $1200.   

[bluetrumpet]

Confirming this solution worked!

In summary, for the first part of the year my employer withdrew the HSA payment from my pay but did not reduce the federal wages.  In my desktop Turbotax it looks like this:


The amount entered black circle was ~$1200. Taxes owed were reduced as expected.

Thanks again!