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Level 7
February 19, 2024
Solved

HSA Distribution. Where do I put the prior balance in the HSA kitty?

  • February 19, 2024
  • 3 replies
  • 12 views

The client is rather new and I don't have a history of her HSA available funds. So the distribution becomes taxable. Is there a line on Form 8889 where I indicate that there are funds in the HSA that she can w/d taxfree?

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Best answer by Just-Lisa-Now-

Yes, that box on the 1099SA needs to be checked, but the 8889 bugs you for an ending HSA value and still makes things taxable if you dont mark that self or family box in the smartworksheet.

That box really should be lit up pink so people know one or the other needs to be checked.

3 replies

Just-Lisa-Now-
Intuit Community Champion
February 19, 2024

Not sure I follow.....if she used the HSA funds for medical expenses, its not taxable,

You need to mark the Self or Family box in the smart worksheet below Line 2 on the 8889 and it wont be a taxable distribution.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪
abctax55
Level 15
February 19, 2024

The prior balance in the 'kitty' is irrelevant. The use of the distribution is what determines taxability.

HumanKind... Be Both
ljr
Level 9
February 19, 2024

there is a check off box on the input that says used 100% for medical - check that box and it makes it non taxable

Just-Lisa-Now-
Intuit Community Champion
February 19, 2024

Yes, that box on the 1099SA needs to be checked, but the 8889 bugs you for an ending HSA value and still makes things taxable if you dont mark that self or family box in the smartworksheet.

That box really should be lit up pink so people know one or the other needs to be checked.

♪♫•*¨*•.¸¸♥Lisa♥¸¸.•*¨*•♫♪