HSAPer my HSA website as of today, I have available to spend $2300Form 5498-SABox 2 Total contributions in 2020 $1750Form 1098-SA Box 1 $396.36Turbo tax is saying I will be taxed 6% on the $1750 unless I spend it before a certain date.I read on a previous Turbo Tax forum, if I withdraw it, I will be taxed 20% next year for not spending it on medical expenses.Should I leave it or spend it?Should I stop depositing money into my HSA for 2021 to avoid being taxed next year?=-=-Also Turbo Tax says ‘Lets get this from your 1099-SA”payer name, address, city, Federal ID no., account no. optional. My form 1099-SA only shows the amount in Box 1 of 396.36. It doesn’t show anything else.Do I need to put each, and every dollar spent to each medical source- doctors, prescriptions, labs from the HSA website?

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Taxxat47taxxaT

Level 2

Question

HSA

Forum|Forum|5 years ago
March 31, 2021
1 reply
7 views

HSA

Per my HSA website as of today, I have available to spend $2300

Form 5498-SA

Box 2 Total contributions in 2020 $1750

Form 1098-SA Box 1 $396.36

Turbo tax is saying I will be taxed 6% on the $1750 unless I spend it before a certain date.

I read on a previous Turbo Tax forum, if I withdraw it, I will be taxed 20% next year for not spending it on medical expenses.

Should I leave it or spend it?
Should I stop depositing money into my HSA for 2021 to avoid being taxed next year?

=-=-

Also Turbo Tax says ‘Lets get this from your 1099-SA”

payer name, address, city, Federal ID no., account no. optional. My form 1099-SA only shows the amount in Box 1 of 396.36. It doesn’t show anything else.

Do I need to put each, and every dollar spent to each medical source- doctors, prescriptions, labs from the HSA website?

JamesG1

Level 15

Your 2020 contributions of $1,750 are not eligible to be deducted?

Are you not covered by a high-deductible health plan?

The software will likely conclude that you have an excess contribution that may be:

Withdrawn in part,
Withdrawn in full, or
Subject to an extra tax of 6%.

The remedy is generally to withdraw the $1,750 by May 17 from the plan so as to avoid the 6% penalty.

If you are not covered by a high-deductible health plan, you should make no more contributions to your health savings account.

To be eligible to contribute to an Health Savings Account in 2020, you:

Must have been covered by a high-deductible health plan (HDHP);
Did not have Medicare or other secondary health insurance policy; and
Were not eligible to be claimed as a dependent on another return, no matter if you were claimed or not.

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Taxxat47taxxaTAuthor

Level 2

Thank you for answering the first part of my question. Could someone please answer the second part

Also Turbo Tax says ‘Lets get this from your 1099-SA”

payer name, address, city, Federal ID no., account no. optional. My form 1099-SA only shows the amount in Box 1 of 396.36. It doesn’t show anything else.