Health Care FSA

[Lunna]

Hi, I don't see my Health Care FSA contributions on my W-2 form (I just retired from my federal job).  Were those contributions already minused (excluded) out (as well as my TSP contributions?) from box 1 of my W-2?  If so, fine, but if not, would I then in box 1 of the W-2?  On the turbotax deluxe page it has a link to "What if I have a Flexible Savings Account (FSA)" but when I click on that link, I get an "Online Demand Tax Guidance" pop up box, but it is empty.  Thank you.

[xmasbaby0]

Did you look in box 12 of your W-2?    If you think the employer left something out that should be on your W-2, contact the employer for a corrected W-2.  You do not start messing around and entering the W-2 boxes differently than they appear by subtracting anything from those boxes yourself.

[Mike9241]

@xmasbaby0 I think he's asking about an FSA, not an HSA. 

[Lunna]

Right.  I’m wondering if my FSA contributions were already accounted for on my W-2.  Same question regarding my TSP contributions. Thanks!

[BillM223]

There is no reporting requirement for FSA contributions, so you will not see it on your W-2. They have already been excluded from your income in box 1 on your W-2.

As the IRS says on page 16 of Pub 969

Note. Unlike HSAs or Archer MSAs, which must be reported on Form 1040, 1040-SR, or 1040-NR, there are no reporting requirements for FSAs on your income tax return.

Your TSP contributions are reported on your W-2 in box 12 with a code of D.

[Lunna]

Thank you - this is helpful!  Here’s a collection w up question. Can I ask for a waiver of any penalty I may gave due to the unexpected windfall I received (VSIP/retirement incentive) and my lump sum unused annual leave payout (which covered pay periods extending into 2026 but all paid out in October 2025?  (There is an option to fill in the explanation for a penalty waiver request in TurboTax). Note that I I made quarterly estimated payments throughout 2026 but could not have anticipated the federal employment retirement push that occurred in 2025 when the year began. I retired on September 30, 2025. 

thank you!

[BillM223]

I would not want to dissuade you from asking for a waiver of penalty for the underpayment of estimated tax - it is your right to do so.

Did you make any additional estimated tax payments for the 3rd or 4th quarters? I don't know if you knew what was happening to your job by the due date of the third quarter (9/15/2025), so maybe an additional estimated tax payment would not have been possible. However, it sounds like you should have known by the due date of the 4th quarter (1/15/2026) that you would have this extra income, so you could have made an additional estimated tax payment before then.

Sorry, I am just anticipating what the IRS might say.

However, federal employees had a totally unpredictable year in 2025 in terms of job security, so I would say go for it. Perhaps your ex-fellow government employee at the IRS might cut you some slack.

[Lunna]

Hi - yes, I tripled my payments during the fourth quarter prior to January 15, 2026.  As painful as that was, it appears that that wasn’t enough (sigh). I will say that I received all the retirement related payments during the fourth quarter. They included the 25000 VSIP retirement incentive and a lump sum payout for almost 8 pay periods worth of unused annual leave, which would have covered a chunk of pay periods in 2026.  I figure it is a reasonable waiver request. I hope the IRS folks will u destined, as you note, the unanticipated and unexpected craziness 2025 wrought on the federal work force. Had I jut retired, I would have been able to carry over my unused annual leave into 2026. 

[Lunna]

PS - I guess too that 2025 and DRP/DOGE etc. vis the federal workforce should meet the ‘unusual circumstances’ criterion for a waiver.  We did not even know when we would receive our VSIP incentive payment or our annual leave lump sum payout (indeed, some folks who retired on September 30 haven’t received a cent yet!)