Question

How is S-Corp Owner HSA contribution reported on Form 8889?

Forum|Forum|3 years ago
December 23, 2022
1 reply
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If I own an S-Corp that pays my HSA contribution, how is that reported on Form 8889 on my personal return?

-my family health plan qualifies as HDHP

-the S-Corp pays full HSA contribution for my spouse and me which is $7,300

-the HSA contribution is included in Box 1 of my W2 (and Box 14) so the S-Corp deducts it as compensation expense

-the contribution flows through to my personal return on Form 8889

Is the contribution classified as an employee or employer HSA contribution on Form 8889? The classification affects if it flows through to Schedule 1 which is why I ask. Thanks!

Thanks!

M

Mike9241

are the health insurance premiums paid by the S-corp and included in box 1 of the w-2 and reported in box 14 of the w-2 so you get a self-employed health insurance deduction.

Note: If the S Corporation does not reimburse the greater than 2% shareholder for the premiums,
the employee is not allowed to take it as an above the line deduction; it may only be deducted as an
itemized deduction subject to the 10% medical expense threshold.

The HSA would be handled the same way as properly handled medical insurance. not box 12 code W of w-2 but box 14 with a notion like HSA Cont.

then like the health insurance that would qualify to be deducted on line 17 of schedule 1 the HSA contribution is treated on the 8889 as if you made them not the employer and you would get a deduction on line 13 of schedule 1.

T

taxman2131Author

That answer is spot on and exactly what I was looking for. I was looking at a return (that I didn't work on) yesterday that had the HSA deduction calculated incorrectly. Everything was fine (included in Shareholder Box 1 wages, Box 14 on W2, deducted on 1120s, etc) until Form 8889, when the deduction was entered as employer, not employee, so the deduction didn't flow through to Schedule 1.

You confirmed my suspicions which I further confirmed today with fellow coworkers.

On a side note, it took me almost 15 minutes to log in and navigate to this response. The interface for this site is awful. I think it made me choose a new username. We'll see when I finish this post.

Anyway, thank you!