My HSA distribution for 2016 was $1260. But I only used it for prescriptions and for physical therapy.
But I paid out of pocket for:
-health care professionals $5,560
-eye exam $200
-medical travel $240
The last question under the Medical deductions section asks me to "Confirm the amount you withdrew from your HSA/MSA to pay for medical expenses. We just want to make sure this money was used to pay for the medical expenses you told us about on the previous screens."
But I did NOT use my HSA bank to pay for most of those expenses. How do I convey that to TurboTax and get the proper deduction.
The reason that this screen is asking this question is because of something that TurboTax is doing that is perhaps not obvious
.
TurboTax wants you to enter ALL medical expenses into Medical and Dental for Schedule A. Then TurboTax will ask you about any insurance reimbursement and it will subtract that amount from the first amount.
Then TurboTax will ask you to confirm your HSA distributions, so that you will remember to have entered the HSA expenses paid for in Schedule A above, because TurboTax is going to subtract the HSA distributions as well.
The question does not mean to imply that you used the HSA for all the previous expenses, only that all the things that you used the HSA for were listed before.
Now, having said all this, did you know that you can reimburse yourself for out-of-pocket expenses from your HSA, so long as you were in the HSA when the expenses were incurred?
There is no deadline on when you have to reimburse yourself - you can do it years later. You just call the HSA plan administrator and ask for a distribution to reimburse yourself for out-of-pocket qualified medical expenses.
The advantage is that with Schedule A, it is difficult to get any tax benefit because of the 10%/7.5% floor on medical expenses. But with an HSA, every dollar you spend on qualified medical expenses is paid for with a pre-tax dollar.
The reason that this screen is asking this question is because of something that TurboTax is doing that is perhaps not obvious
.
TurboTax wants you to enter ALL medical expenses into Medical and Dental for Schedule A. Then TurboTax will ask you about any insurance reimbursement and it will subtract that amount from the first amount.
Then TurboTax will ask you to confirm your HSA distributions, so that you will remember to have entered the HSA expenses paid for in Schedule A above, because TurboTax is going to subtract the HSA distributions as well.
The question does not mean to imply that you used the HSA for all the previous expenses, only that all the things that you used the HSA for were listed before.
Now, having said all this, did you know that you can reimburse yourself for out-of-pocket expenses from your HSA, so long as you were in the HSA when the expenses were incurred?
There is no deadline on when you have to reimburse yourself - you can do it years later. You just call the HSA plan administrator and ask for a distribution to reimburse yourself for out-of-pocket qualified medical expenses.
The advantage is that with Schedule A, it is difficult to get any tax benefit because of the 10%/7.5% floor on medical expenses. But with an HSA, every dollar you spend on qualified medical expenses is paid for with a pre-tax dollar.