No, you don’t enter
an 8889, we generate one based on your answers in the interview for “HSA MSA Contributions” under Medical under Deductions & Credits.
You probably have an HSA, and the 1099-SA shows the amount
of money that was distributed out of the HSA, presumably to go to paying
qualified medical expenses. But since the IRS assumes that unless you complete
form 8889 (i.e., answer all the
questions under “HSA
MSA Contributions”) that you spent that
money on non-qualifying expenses, you will be penalized by having to report the
amount on the 1099-SA as income.
This is presumably not what you want.
So, this is how it works:
-
Either you received a 5498-SA to
report how much money was contributed to the HSA, or you have a code W in box 12 on your W-2 (or both). The amount next to the W
is the amount that you (through a section 125 cafeteria plan) and your
employer contributed to the HSA.
- You
also receive a 1099-SA from the bank or financial institution that administers
your HSA, which states how much money you took out from the HSA, generally
by using the debit card for medical expenses that they gave you.
For your part, you need to complete the entire interview for
the HSA that I referred to above, so that you properly report the money
contributed to the HSA (which should be tax-free), and how the money “distributed”
(i.e. “spent”) from the HSA was spent (presumably on qualified medical
expenses).
Once you complete the questions, the 8889 will be correctly
generated, and you will get your tax break.
The following screen shot is what you should see to enter the HSA interview (under Deductions & Credits).
