HSA Tax Forms: Learn More About Form 1099-SA, Form 5498-SA, and More

Think of your health savings account (HSA) as a piggy bank that offers tax advantages for your medical expenditures. If you have an account with your employer, the contributions are made with pretax dollars. This means the contributions are not subject to federal taxes. If you set up your account when self-employed, you can deduct the contributions on your tax return. 

With your HSA, you do not pay taxes on expenditures, so long as they are for qualified medical expenses. But you will need to report contributions and withdrawals on your tax return. This is to avoid having to pay interest and penalties. 

What tax forms do you need for your HSA?

HSAs allow you to save money on healthcare expenses using pretax dollars. But you have to follow the rules to claim these benefits. 

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Any contributions to or distributions from your HSA should be reported to ensure compliance and maintain tax savings. There are also state rules and forms that you should be aware of since some states, such as California, don’t follow federal tax treatment for HSAs. 

Below is a list of tax forms that you should know about if you have an HSA. If you discover an error on any of your HSA tax forms, you should report it to your HSA provider and have it corrected to ensure accurate records and avoid a potential audit. 

Form 1099-SA: Distributions from an HSA, Archer MSA, or Medicare Advantage MSA 

If you withdraw money from your HSA, you should receive Form 1099-SA from your HSA provider. This form reports the total distributions from an HSA, Archer Medical Savings Account (MSA), or Medicare Advantage MSA and is typically sent by January 31 of the year following the year in which you withdraw money from your HSA.

Let’s say you make the following HSA withdrawals in 2023: 

• $2,000 for hearing aids 

• $250 for prescription sunglasses

• $200 for prescription contact lenses 

When you receive Form 1099-SA, you’ll notice that $2,450 is shown in Box 1. This box 

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represents the total amount of distributions — qualified and non-qualified medical expenses — taken from the HSA and other similar accounts during the year. 

However, the distribution code shown in Box 3 will indicate the type of distribution taken and will help determine if the distributions are taxable. For example, Code 1 indicates normal distributions, which means the distributions were qualified medical expenses and not taxable. 

Form 5498-SA: HSA, Archer MSA, or Medicare Advantage MSA Information

Every year, the IRS allows eligible individuals with a high-deductible health plan to contribute money to an HSA up to a certain limit. If you contributed money to an HSA in 2023, you should receive Form 5498-SA from your HSA provider by May 31, 2024. This form shows how much money you and your employer contributed to your HSA during the tax year. Let's say you contributed $3,000 to your HSA for 20023; you should see that number reported in Box 2 on Form 5498-SA. 

For 2023, you could contribute up to $3,850 to an individual HSA ($4,150 in 2024). If your employer contributes money to your HSA, that will count toward your maximum contribution limit. You have until April 15, 2024 to contribute to an HSA for 2023. 

Form 8889: HSA, Archer MSA, or Medicare Advantage MSA Information

If you make any contributions to or take distributions from your HSA during a tax year, you need to file Form 8889 with your tax return. This form is important for reporting contributions and distributions, as well as calculating any additional taxes or income related to your HSA.

Here’s an example: In 2023, you contributed $2,000 to your HSA. You would report these contributions on Part 1 of Form 8889. You can use Form 5498-SA, which is provided by your HSA administrator, to find all the information needed to report the details of your contributions on Form 8889. So, in Part I, you'd report the $2,000.

Now, suppose you also had HSA distributions totaling $1,200 for various medical expenses in the same year. These distributions should appear on your Form 1099-SA that you received from your HSA provider. In Part II of Form 8889, you would report this $1,200.

Finally, in Part III of Form 8889, you need to calculate any additional taxes or reportable income arising from your HSA activities. This part of the form helps determine if there are any tax implications from your HSA distributions, especially if the funds in your account were not used for qualified medical expenses. 

By accurately completing each part of Form 8889, you ensure that all your HSA contributions and distributions are correctly reported to the IRS.

Form 5329: Additional Taxes on Qualified Plans (including IRAs) and Other Tax-Favored Accounts

There is a limit to how much you can contribute to an HSA every year. If you go over that limit, you will need to report your excess contributions to the IRS. You can use Form 5329 to calculate the 6% tax penalty owed for excess contributions to an HSA. If the amount is not reported on Box 1 of the Form W-2 you receive from your employer, you will include the amount on Schedule 1 of your 1040 return as “Other income.”

Let’s say you are under 55 and have an individual HSA in 2024. The HSA contribution limit for 2024 is $4,150, but you contribute $4,500. The IRS will send you a notice that you have an excess contribution of $350. This information is based on what your HSA provider reports to the IRS.  

You would report this $350 as your excess contribution on Form 5329. Then, you calculate the 6% tax penalty, which amounts to 6% of $350, or $21.

Form W-2:  Wage and Tax Statement

This form will show HSA contributions from you and your employer during the tax year. The contributions will appear in Box 12, with code W. The amount shown reduces your taxable income for the year. This can lead to a lower tax liability when you file your tax return. 

Suppose your income is $60,000 and you contribute $3,500 to your account. This is done with payroll deductions, which are pretax dollars. This means the annual taxable income reported to the IRS is $56,500, or $60,000 minus $3,500. If your tax rate is 22%, then you will have saved $770 in taxes.  

How can you request HSA tax forms?

This chart shows how to receive these forms:

What happens if you don’t report your HSA on taxes?

You may owe penalties and interest for not reporting withdrawals of contributions on your tax return. For 2024, the interest rate for not paying taxes is 8%. There are also different types of penalties, which include:

• Failure to file: The penalty is 5% of the unpaid tax for each month or part of a month the return remains unfiled. The maximum is 25% of the tax owed.

• Failure to pay: This is 0.5% per month, with a maximum of 25% of the tax owed. This rate can increase to 1% per month after the IRS issues a notice of intent to levy.

• Accuracy-related penalties: There is a 20% penalty calculated on the underpayment due to negligence or substantial understatement.

Because of the consequences of not reporting your HSA on taxes, you should resolve this quickly and reach out to a tax professional if you need help. You may need to file amended returns, or you could potentially be impacted by an IRS audit.   

What’s the difference between Form 1099-SA and Form 5498-SA?

You use Form 1099-SA to report distributions from an HSA for the tax year. This is important to make sure that you spend the funds in your account on qualified medical expenses.  

Form 5498-SA, on the other hand, records contributions to your HSA. These contributions can be made by you or your employer. This form is important to show that your contributions did not exceed the limit.   

What should you do if you don’t receive tax forms for your HSA?

If you’re ready to file your tax returns and don’t have all your HSA tax forms, you can take the following steps: 

• Contact your HSA provider: Ask your HSA provider if the forms were sent. If they were, verify your address. The tax forms may have been sent to the wrong address.  

• Check online access: Many financial institutions provide these forms electronically so you’ll be able to download the forms from your HSA provider’s website. 

• Request a duplicate: If the forms were sent but not received, or if there was an error, request that the HSA provider reissue or provide duplicate copies of the forms.

An HSA provider will usually send Form 1099-SA by January 31, whereas Form 5498-SA will often be sent later. It may even be sent in the summer. If this is the case, you can file an extension for your tax return. Or you can use your HSA records to report your contributions.  

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Written by:

Tom Taulli, EA

Tom Taulli, EA, operates his own tax preparation and planning firm, Pathway Tax, which he founded in 2000. He is a licensed enrolled agent and can represent taxpayers before the IRS. He can also prepare and advise on tax matters for all 50 states.

Edited by:

Charlene Rhinehart, CPA

Charlene Rhinehart, CPA, is a personal finance editor at GoodRx. She has been a certified public accountant for over a decade.

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