From the HSA section, for the question "Any contributions you personally made (not through your employer)", should I enter the amount that was taken out of my paycheck?

[foster_caprice]

Money was taken out of every paycheck for my HSA. Is this considered a personal contribution, or is that considered "through my employer"?

[AnnetteB · Accepted solution]

If the money was put into the HSA through payroll deductions, then it is considered to have been made through your employer. 

Essentially, the employer acted as the middle man to put your funds into the account.  These funds are pre-tax and should have been reported on your W-2 in box 12 with code W.

The question you are seeing is referring to any after-tax contributions that you made to the HSA.

[aamir0]

yes, but then how to get this information? through 5498-SA? Thanks.

[AnnetteB6]

If money was contributed to your Health Savings Account (HSA) through payroll deductions from your earnings at work, it should be reported on your W-2 in box 12 with code W.  If your employer made contributions on your behalf, it would also be reported on your W-2.  

Form 5498-SA will also show any contributions that were made to the HSA for the year, but you would not necessarily use that as a source of information for your tax return other than to verify that the amounts shown on Form 5498-SA match the amounts reported on your W-2 plus any contributions you made directly to the HSA.

For more information see the following TurboTax article:  Where do I enter Form 5498-SA?

@aamir0

[vannatte1]

Last year, I believe I mistakenly input the amount of my HSA contributions that were payroll deducted into the "Any contributions you personally made (not through your employer)" line on my 2020 taxes.  How did this impact my taxes last year and is there anything I can do to correct this on my 2021 filing?

[dmertz]

@vannatte1 , reporting more than the actual contributions on your 2020 Form 8889 might have resulted in your tax return including Form 5329 to calculate and report an excess contribution that would have added a penalty to your 2020 tax return.  If that happened, you'll want to amend your 2020 tax return to get the penalty refunded.  If your 2020 tax return did not include Form 5329, the inflated amount on Form 8889 probably does not cause any problems (other than the fact the the Form 5498-SA from the HSA will report a lower number that what was shown on your Form 8889, which the IRS may or may not question).  [Actually, the 2020 tax return must be amended to make the correction.  See my follow-up reply below.]

Nothing about this affects your 2021 tax return except, perhaps, a carryforward of an excess contribution reported on your 2020 tax return.  If present, this carryforward of the excess contribution will need to be corrected in 2021 TurboTax.

[vannatte1]

@dmertz Ok, so I checked my taxes from last year and I could not find Form 5329 attached.  How do I account for a carryforward of an excess contribution reported on your 2020 tax return on my 2021 filing?  

[vannatte1]

Also, just to clarify, I did not over-contribute.  I simply included $1,820 that was payroll deducted as a additional personal contribution so I am assuming this was effectively counted twice on my 2020 filing. 

[dmertz]

I misspoke in my previous reply.  Entering the contributions made through payroll also as personal contributions produced a deduction on your 2020 tax return to which you were not entitled.  Assuming that this deduction affected your tax liability, you'll need to amend your 2020 tax return to correct that.  If you don't amend your 2020 tax return, there's a good chance that the IRS will detect the error and bill you for the balance due for 2020.

Since there wasn't any Form 5329 included in your 2020 tax return, none of this affects your 2021 tax return.