W-2 box 12 code W

[jnstvn1410]

TurboTax will not recognize that I made contributions to an FSA and not an HSA. My W-2 lists the amount in box 12 with the code w as the amount of contributions I made to an FSA. This is correctly coded - confirmed by HR and our payroll provider.  From ADP code - 

• W - Employer contributions to an employee’s Health Savings Account (HSA) plus any employee contributions made under a Cafeteria 125 Plan.

An FSA is a part of a cafeteria 125 plan. What do I need to do to have this recognized in turbo tax?

[BillM223]

If ADP told you this, they are wrong. I have heard this before from other taxpayers, but ADP is still wrong.

Code W in box 12 is ONLY for HSA contributions. 

Please direct your HR people to the W-2 instructions that make this very clear (page 22).

Code W—Employer contributions to a health savings account (HSA). Show any employer contributions (including amounts the employee elected to contribute using a section 125 (cafeteria) plan) to an HSA. See Health savings account (HSA).

The reference to a section 125 plan that the HSA contributions by the employee can be made by payroll deduction, like other section 125 plans. It does NOT mean that all section 125 plans can use code W.

I am sorry, but you need a corrected W-2.

[jnstvn1410]

Thank you for the prompt response and the direct link. It's been a pain trying to get any information from ADP.

[Mike9241]

sorry 12 w is strictly for HSA which are completely different than an FSA

this is from IRS w-2 instructions for 2024

"Code W—Employer contributions to a health
savings account (HSA). Show any employer
contributions (including amounts the employee elected to
contribute using a section 125 (cafeteria) plan) to an HSA"

(HSA's are also section 125 plans)

https://www.irs.gov/pub/irs-prior/iw2w3--2024.pdf 

You can not have HSA coverage if you have FSA coverage

Since FSA salary reductions are contributions to the account and aren’t included in your taxable wages on your W-2, you don’t enter them as a deduction on your tax return. They may appear in Box 14 of the W-2 for informational purposes only. You can verify this with your employer.

see this link

https://fsastore.com/articles/learn-can-i-have-an-fsa-and-an-hsa.html 

you can do nothing in Turbotax the W-2 is coded wrong. the amount on 12W will carry to the HSA form line 9

further from the instructions for form 8889 (HSA)

Employer contributions (including employee payroll
contributions through a cafeteria plan) include any amount an
employer contributes to any HSA for you for 2024. Also,
include contributions made by a health insurance plan on an
employer's behalf. These contributions should be shown in
box 12 of Form W-2 with code W. 

[venuc123]

I too have this exact problem.

I am being forced to admit I had a high-deductible health plan to remove errors in Turbo Tax smart check.

What correction can my ex-company's payroll department make to get me out of this bind?

One thing I can think of is to remove code W entry in W-2. Then what happens to my FSA contribution?

Thanks

[KeshaH]

The employer will need to remove box 12 on the W-2. No other changes would need to be made, however, they may include the contributions in box 14 as well. Box 14 is informational, so it's not necessary to have an amount here.