I made my HSA contribution for TY 2016 during 2017. What should I enter for 5498-SA box 2 for TY 2017?

[dolphin]

I am self-employed and made my TY 2016 HSA contribution (max amount: $3350) while I was working on my taxes during 2017.  My Form 5498-SA says that I contributed $3350 to my HSA during 2017, but I already took this deduction on my taxes for 2016.  For TY 2017, I haven't contributed anything to it, although this might change.  

If I enter $3350 for my contributions during 2017 again, my refund goes up significantly.  But I think I've already taken the deduction for this contribution last year.

So instead of entering $3350 for 5498-SA box 2, should I enter $0 until I've made another contribution?

[dmertz · Accepted solution]

Form 5498-SA box 1 is not for HSA contributions at all.  Box 1 is for Archer MSA contributions.  If you made an HSA contribution yet it appears in box 1, contact the account administrator.

Any HSA contribution made in 2017 should appear in box 2 of the 2017 Form 5498 regardless of whether the contribution was for 2016 or 2017.  If this contribution was made for 2016, it should also be present in box 3 of your 2016 Form 5498-SA.  The HSA contributions for any given year is the sum of the box 2 and box 3 amounts on that year's Form 5498-SA minus any amount in box 2 that represents a contribution reported in box 3 of the previous year's Form 5498-SA.

Since you are self-employed and do not receive a W-2, your HSA contribution would be reported as a personal contribution.  Since Forms 5498-SA typically are sent after the due date of your tax return, one normally enters the contribution amount based on personal records.

[dolphin]

@dmertz and @TurboTaxBillMc - My mistake, the 5498-SA form does tell me that it is $3350 for box 2.  Box 1 and box 3 (Total HSA or Archer MSA contributions made in *2018 for 2017* [not 2017 for 2016]) are both blank.  However, I logged into my HSA's website and my contribution is showing as being for 2016 (which from my intention is correct), not 2017.  I don't have any forms for 2016 available on their website because I had reopened my account in early 2017 to make this contribution.  I'll email the HSA administrator right now to see what I can find out.

[dmertz]

Sounds like everything is correct except that the custodian was required to issue a 2016 Form 5498-SA to show the contribution in box 3.  You might consider obtaining your 2016 Wage & Income transcript from the IRS two see the details of the 2016 Form 5498-SA sent to the IRS.

[dolphin]

@dmertz Would the HSA administrator have sent a Form 5498-SA to the IRS for me for 2016 if their website doesn't show that I have any tax forms for 2016?

[dmertz]

If they recorded a contribution for 2016, they are required to have sent a Form 5498-SA to the IRA and to have provided you with a copy.  It's possible that the your copy got lost somehow, but it would be an even greater error if they also failed to report it to the IRS.

Thinking about this again, the lack of a 2016 Form 5498-SA could be indicating that they treated the entire box 2 amount as a 2017 contribution.  So disregard what I said about everything seeming to be correct; it's not yet possible to reach that conclusion, so TurboTaxBillMc's answer may be more specifically describing your situation.

[dolphin]

I'm sorry for the long delay, @dmertz and @TurboTaxBillMc.  I finally had time to call the HSA administrator tonight. They told me that because I made the contribution during 2017 for 2016, the contribution would show up on the 5498-SA's for both 2016 and 2017 - and oddly enough, I can still make more contributions for 2017 until April 15, 2018.  I didn't receive a 5498-SA for TY 2016 during 2017 because my account wasn't active until after January 31, 2017.  They're going to send me the 5498-SA for TY 2016, and I don't have to amend my return.

[dmertz]

"I didn't receive a 5498-SA for TY 2016 during 2017 because my account wasn't active until after January 31, 2017."

The deadline for filing Forms 5498-SA is May 31, not January 31, so that's not an excuse.  You should have received the 2016 Form 5498-SA by early June, 2017.  It's good that they are sending you the missing form.

It still might be worth obtaining your 2016 Wage & Income transcript to see that the 2016 Form 5498-SA was properly reported to the IRS.

[dolphin]

@dmertz Good idea on the transcript.  I think I might need that anyway soon since I'm sponsoring my fiancee's immigration, so I got my IRS.gov account tonight.  The Form 5498-SA is not on my Wage & Income Transcript for 2016.  I did find one in my Wage & Income Transcript for a prior tax year (before I started my business).

[dmertz]

If it's not presently in your 2016 transcript, it seems that the HSA custodian failed to file it timely.  Perhaps they are only now filing it (late).

[dolphin]

I think they only told me that they're mailing me a TY 2016 5498-SA.  They said the contribution for tax year 2016 (made in 2017) will be listed on it, but they don't seem very competent.  I guess we'll see when I get the form.  But they didn't say they would send it to the IRS.

[dmertz]

They are required to send it to the IRS, but that's not to say that they will since they are likely to be subject to a penalty for filing the form late.  They might just hope that no one at the IRS notices.  If the IRS does notice, you'll be the one left holding the bag unless you can document with your copy of the 2016 Form 5498-SA that the contribution was made for 2016.  Be sure to keep the one they send you forever in case the IRS ever does think that the contribution for 2016 was an excess contribution for 2017 that would be subject to annual penalties.

[BMcCalpin]

When you made the contribution for your HSA in early 2017 (OK as long as it is before the due date of the return), did you specify to the HSA administrator that this $3,350 was for 2016 not 2017? If not, the default action by the HSA administrator would have been to apply it to 2017.

If they applied it to 2017, then you should not have taken the "deduction" on your 2016 return.

Since it has been a year since these events occurred, I think that it is too late to get the HSA administrator to change the 2017 contribution to 2016 as it should have been, so you will have to amend your 2016 return to remove that "deduction". 

Don't change the entry for 2017, because that would be making two errors instead of one - although the net effect may be close to the same (it depends on your marginal tax rate among other things), if the IRS notices the discrepancies, they will make you amend both returns.

Just leave the contribution as is for 2017, and go back and amend your 2016 return. Note that interest is running on the amount that will be due on 2016, so don't put it off.

[dolphin]

@TurboTaxBillMc On the administrator's website, the contribution shows up as being during early April 2017 for tax year 2016.  This was when I reopened my HSA.  However, the administrator never gave me tax forms for tax year 2016.  It sounds like they need to give me a (corrected?) 5498-SA for TY 2016 and also correct the 5498-SA for TY 2017.  I just emailed them about this.  They had to send me the tax forms for 2016 by January 31st (2017), but I had until April 15th (2017) to make a contribution for 2016.  Because that contribution was after January 31 but before April 15, do they need to send me a corrected form?