HSA contributions

Forum|Forum|3 years ago
March 14, 2023
3 replies
21 views

The employer contribution to HSA was understated on the W-2. How will this impact my tax return? Since the report from the HSA bank is accurate, do I still need to amend my return?

Not A Product Question

HelenC12

Level 15

Yes, you may need to amend if your employer gave you a corrected W-2C and it changes your refund or amount due.

Please see Do I need to amend?

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Mike9241

Level 15

it would likely have no impact unless the W-2 box 1 wages are overstated because of the error. deductions from your paycheck to fund an HSA are supposed to reduce box 1 wages. so if it's correct but 12W is not, there would likely be no changes in your taxes. the exception to this would be if the HSA has overfunded either by you or matching employer contributions. if you need to amend you need that W-2c

Mike9241

Opus 17

Level 15

When you make payroll contributions, the tax law treats that as you agree to a voluntary salary reduction (reduces your box 1, 3 and 5 taxable wages), and your employer contributes that amount to your HSA, along with any employer match. (So all payroll contributions should be in box 12 with code W, both your voluntary contributions and any match.)

If your taxable income in boxes 1, 3 and 5 are correctly reduced for your HSA contributions, then your income tax will be correct. If only box 12 code W is incorrect, that may trigger an IRS letter at some point, and you should ask for a corrected W-2, but it won't change your tax return.

If boxes 1, 3 and 5 are not correct, you definitely need a corrected W-2.