HSA Contributions for 2024 incorrect on W2 Form – What to enter in TurboTax?

[G-Man]

Fidelity is my custodian for my HSA. In 2024, there was $950 of HSA company contributions that came in late (first 2 months of 2024) for the 2023 calendar year. So, I worked with Fidelity for over a month to successfully earmark those company contributions for the calendar year 2023. So, the HSA reports on the Fidelity side is correct and reflects the correct HSA contributions (company & participant) for 2024.

However, on line 12b (code W) on the W2 form, it shows $950 dollars too much for the total HSA contribution for 2024.

How should I handle this discrepancy when entering the information in TurboTax? Please advise.

 

[cathy63]

Your employer should issue corrected W-2s for 2023 and 2024.

 

[G-Man]

Your employer should issue corrected W-2s for 2023 and 2024.

I spoke with my former company HSA representative about this matter. Their response was "We do not adjust W-2s for HSA reallocations. You will receive a tax form from Fidelity that will show this adjustment which you will use in combination with your W-2 when filing your 2023 taxes".

So, I don't think they will reissue a W-2 form.

So, when entering my W2 form in TurboTax, do I enter the correct HSA amount for line 12b and not what is reflected on the W2 form?

 

[cathy63]

You should almost never enter a different number than what's on your W-2. I just went into TTax and found this screen under the HSA section. I suggest you use this if your employer won't correct the W-2s.

 

[G-Man]

You should almost never enter a different number than what's on your W-2. I just went into TTax and found this screen under the HSA section. I suggest you use this if your employer won't correct the W-2s.

View attachment 54046

Thank you so much

 

[G-Man]

Hopefully that will solve the problem, and I won't get an audit letter from the IRS.

 

[G-Man]

You should almost never enter a different number than what's on your W-2. I just went into TTax and found this screen under the HSA section. I suggest you use this if your employer won't correct the W-2s.

View attachment 54046

I found this article on the web.

Correcting Missed HSA Contributions

Newfront's Brian Gilmore discusses how employers can correct missed HSA contributions.

www.newfront.com

It's looks like an IRS Form 8889 must be filed out if a corrected W2 form is not sent out by the employer. Maybe that is what TurboTax is creating after you answer the question about contributions for a previous year.

 

[cathy63]

TurboTax is creating the 8889 regardless. You need it for all HSA contributions and distributions. The extra screen I captured is adjusting the amount on Line 9 by removing the prior year contributions from the amount shown on your W-2.

 

[G-Man]

TurboTax is creating the 8889 regardless. You need it for all HSA contributions and distributions. The extra screen I captured is adjusting the amount on Line 9 by removing the prior year contributions from the amount shown on your W-2.

Thank you so much for responding. Once I enter the information in TurboTax, I will verify the amount on Line 9 of the 1040 form.

 

[Rianne]

Your employer should issue corrected W-2s for 2023 and 2024.

I'm not sure about this: We're past HSA contributions (67 yrs old) and only take distributions for expensive medical, like over $500. Do I have to claim that? My Taxslayer has a place for it, but does it matter other than proving it's for qualified expenses?

 

[G-Man]

You should almost never enter a different number than what's on your W-2. I just went into TTax and found this screen under the HSA section. I suggest you use this if your employer won't correct the W-2s.

View attachment 54046

It looks like this may work in TurboTax. I entered the employer contribution amount made in 2024 for the tax year 2023 and on the HSA summary screen, it shows the correct total HSA contribution amount (employer and participant) on the "Tax-free employer contributions" line.

I guess I need to check form 8889 as well.

 

[cathy63]

I'm not sure about this: We're past HSA contributions (67 yrs old) and only take distributions for expensive medical, like over $500. Do I have to claim that? My Taxslayer has a place for it, but does it matter other than proving it's for qualified expenses?

You quoted my comment that the employer should issue corrected W-2s? If you don't have HSA contributions, you don't have to worry about what's on your W-2s.

If you're asking about whether you're required to file an 8889 when someone issues a 1099-SA, then the answer is usually yes. If you meet the requirements to file a tax return, and you don't include an 8889, then the IRS will eventually send you a letter telling you they are treating the distribution as taxable and here's how much you owe.

If your income is below the filing threshold and including the 1099-SA distribution as taxable income wouldn't push you over, then you don't need to file a return just because the 1099-SA was issued.

 

[G-Man]

It looks like this may work in TurboTax. I entered the employer contribution amount made in 2024 for the tax year 2023 and on the HSA summary screen, it shows the correct total HSA contribution amount (employer and participant) on the "Tax-free employer contributions" line.

I guess I need to check form 8889 as well.

Ok. I checked Form 8889-T and the correct amount is reflected on Line 9F which reflects what my HSA custodian (Fidelity) is reporting for 2024.

Thanks