Calculate HSA Net Capital Gain or Loss, for CA tax purposes?

[sese]

HealthEquity provides a Year End Statement, which has a section for "Net Investment Gains or (Losses) during 2020". Anyone knows whether that's the same as Capital Gains that we need to report or unrealized gains/losses (which we don't need to report)? - trying to understand where to look for Capital gains

(Tried to check with HealthEquity, but the agent does not have any idea.)

Thank you!

[Bsch4477]

California taxes any realized capital gain or distribution in the HSA account. Basically it treats the HSA as es regular investment account. 

[sese]

Thanks! I'm trying to understand where to look for Capital gains on my HSA account. 

[shiyi11]

@sese same problem, I believe the number reported on the website includes unrealized gain. trying to do math on the realized part.

I figured it out. For all the health equity user out there. PSA, click this button do download the actual buy/sell log. Then calculated the Realized capital gain from there.

[Weasley_]

I talked to a HSA rep who showed me a calculator for capital gain! You just have to download that report and upload it to the calculator. It shows you dividend, short term, and long term. Hopefully this helps others: 

https://learn2.healthequity.com/google/hsa/investment-income-calculator

[shanavt]

This calculator is very helpful. My HSA investment is under HealthEquity but it transferred over from Benefit Wallet this year.  Will the calculations still be accurate if that is the case using the calculator? It is showing $0 for long term gains. Thanks!

[John8421]

I assume you had investments under Benefit Wallet. If your Health Equity download does not include those transactions, I can't see how the results would be accurate for you.  Capital gains calculations rely upon cost basis from the date of purchase.

My HSA also transferred from Benefit Wallet to Health Equity in March of 2024.  However, I did not have any investments under Benefit Wallet.  I started them in March under Health Equity, so all transactions are in the download and everything is Short Term for me.  The calculator worked for me.

[BillM223]

NOTE: California taxes all capital gains as ordinary income! This is why TurboTax asks only for "capital gains" and does not differentiate between long term and short term.

The California Instructions for 2024 Instructions for Schedule CA (540) state: "California taxes long and short term capital gains as regular income. No special rate for long term ..."

[bczublin]

My HSA investment account is with Optum Bank. I called them and they said they don't provide a 1099-DIV form. There isn't an option on their site to download a spreadsheet. How do I calculate the dividends and capital gain/losses for CA tax purposes?

[Bsch4477]

If you can’t get the information by looking at your account online just forget about it. 

[John8421]

The HealthEquity link, above, does not require a log in.  The spreadsheet to upload has the following format:

Row 1, Columns A-I merged into one cell that contains "All Investment Transactions"

Row 2, Columns A-I merged into once cell that contains "Date Range: mm/dd/yyyy to mm/dd/yyyy"

Row 3, Columns A-I with the following entries:

Date, Fund, Category, Description, Price, Amount, Shares, Total Shares, Total Value

Rows 4 and on contain your data

Date is in mm/dd/yyyy format

Fund is the ticker symbol

Category is Buy, Sell, Dividend, etc.

Description is  Investment: ticker symbol

Price is $x.xx

Amount is $x.xx

Shares is x.xxx

Total Shares is x.xxx

Total Value is $x.xx

The catch, of course, is that you need a way to obtain this data for your account going all the way back to the original purchases.

[bczublin]

Hello John8421,

Thank you for the detailed information. Without a visual example of what the spread sheet should look like that would be challenging for me. Do you have such an example or know where I could find one?

Thanks!

[BillM223]

As you do this, just remember what I said above - California has no special tax rate for capital gains, that is, "capital" gains are like ordinary gains. 

This means that you don't have to worry about whether or not you have owned the asset for a year. You just need the sales price, the initial price, and the difference which is your taxable gain.

[John8421]

The first two rows don't even need to be included.  So here is a sketch for you showing something purchased in 2023 and partially sold in 2024.  

Date	Fund	Category	Description	Price	Amount	Shares	Total Shares	Total Value
05/19/2023	GOOG	Buy	Investment: GOOG	$123.25	$1232.50	10.000	10.000	$1232.50
07/05/2024	GOOG	Sell	Investment: GOOG	$191.96	$767.84	4.000	6.00	$1151.76

In this simple example, the gains are ($191.96 - $123.25) * 4.000 = $68.71 * 4.000 = $274.84.

[bczublin]

Thank you John8421