Filing Your Tax Return

With such great tax breaks, it’s probably not a surprise you’ll need to do some tax work. We’ll help you by supplying key IRS forms. But, it's up to you to file your annual federal and state income tax returns. Keep in mind:

  • Contributions (deposits) are tax-deductible
  • Earnings on your balance and investments are not taxed
  • Distributions (withdrawals) used to pay for qualified medical expenses are not taxed1

To help you get organized this year, we have compiled an HSA checklist that summarizes the IRS forms you will need to file your 2019 Federal Income Tax Return.

 

IRS Form Number

Description

Provided by UMB

1099-SA
(Furnished by 1/31/20)

HSA distributions (withdrawals) in 2019. Trustee-to-Trustee transfers to another HSA custodian are NOT considered distributions, and are not reported on this form.

5498-SA
(Furnished by 6/02/20)

HSA contributions made 1/1/19 -12/31/19 AND 1/1/20 - 4/15/20. This form includes IRA qualified distributions to your UMB HSA and HSA or MSA rollovers to your UMB HSA. HSA or MSA incoming Trustee-to-Trustee transfers are NOT considered contributions, and are not reported on this form.

Provided by your employer (if applicable)

W-2
(Furnished by 1/31/20)

This form documents:

  • Pre-tax Contributions (employer contributions and contributions you make through a cafeteria plan) are directly deposited into your HSA before taxes are withheld, and reported in box 12 with a code W.
  • Post-tax Contributions (if your employer doesn’t offer a cafeteria plan) that are directly deposited into your HSA after taxes are withheld are included with your taxable wages on lines 1, 3, and 5.

Forms you must obtain from the IRS to complete and file your federal tax return

1040

This form is your Individual Income Tax Return. You will use this form to:

  • Report your tax deduction for HSA contributions (deduction from gross income).
  • Report your taxable non-qualified HSA distributions.
  • Report 6% excise tax on excess contributions you did not withdraw by the tax filing deadline.
  • Report 20% tax for your non-qualified distributions.

8889

This HSA worksheet will accompany your 1040. Its purpose is to:

  • Report your HSA contributions (including those made by you, other parties, and/or your employer). All prior year contributions are reported, even if you made them in the current year.
  • Report your HSA distributions (qualified medical expenses, non-qualified rollovers, and withdrawals for excess contributions).
  • Figure your HSA above-the-line deduction (pre-tax contributions are deducted from your total contributions and are not included in the above-the-line deduction).
  • Figure amounts that must be included in your income and additional taxes owed if you were not eligible for HSA contributions through the testing period.
  • Report an HSA you acquired upon the death of an HSA owner.

5329

This form will accompany your 1040, only if applicable.

Report excess HSA contributions that are not withdrawn from your HSA prior to the tax filing deadline.

 

For detailed information about tax reporting with your HSA, visit the U.S. Internal Revenue Service‡ website.

NOTE: Save your receipts in case you need to prove to the IRS that distributions from your HSA were for qualified medical expenses. UMB makes it easy to track and manage your healthcare receipts all in one place - use ReceiptVault to securely store and organize HSA receipts for qualified medical expenses.

If you use your HSA funds to pay for goods or services that aren’t qualified medical expenses, you are responsible for reporting that to the IRS, paying income taxes on the amount and a 20% penalty if you are under age 65.

Neither UMB Bank n.a., its parent, subsidiaries nor affiliates are engaged in rendering tax or legal advice and this checklist is not intended as tax or legal advice. All mention of taxes is made in reference to federal tax law. States can choose to follow the federal tax-treatment guidelines for HSAs or establish their own; some states tax HSA contributions. Please check with each state’s tax laws to determine the tax treatment of HSA contributions, or consult your tax adviser. Additional federal and state forms may be required.

1Qualified medical expenses are defined in Section 213 (d) of the Internal Revenue Code. A partial list can be found in IRS Publication 502. Any distributions used for purposes other than to pay for “qualified medical expenses” are taxable as income. It is also subject to an additional 20% tax penalty, unless the distribution is made after the accountholder dies, is disabled or reaches age 65. Make sure to keep your receipts to prove to the IRS that distributions were for qualified medical expenses.

For copies of IRS forms, instructions and HSA Publication 969, please visit the IRS Web site at www.irs.gov/formspubs‡.

Funds in an HSA Deposit Account are held at UMB Bank, n.a., Member FDIC.

‡When you click this link, you will leave UMB’s Web site and will go to a Web site that is not controlled by or affiliated with UMB. We have provided this link for your convenience. However, we do not endorse or guarantee any products or services you may view on other sites. Other Web sites may not follow the same privacy policies and security procedures that UMB does so please review their policies and procedures carefully.

Introducing UMB HSA Saver an easier way to invest in your HSA

Now you can invest your HSA savings in UMB HSA Saver and take advantage of our easy-to-use investing platform.

How to Use ReceiptVault

Easily track and manage your healthcare receipts using ReceiptVault.

Watch how to use your HSA

Make the most of your HSA by watching this informational video.