Question

Deductions Summary Page Questions

Forum|Forum|4 years ago
April 10, 2022
1 reply
0 views

I finished entering data into Turbo Tax and got to the deductions summary screen, and I have a couple questions. 1) The Summary shows I have $0 HSA deductions even though I entered a value for both my wife and myself. It shows correctly that in 2020 we had $390 HSA deductions, but why doesn't it show for what we used in 2021?

2) The Summary screen also shows State and Local Taxes greater than $10,000 in the amount of (-$44,823). I haven't done my State taxes in Turbo Tax for 2021 yet, so what is this number? For 2020, this line item is $0.

If anyone can please explain this to me or if I somehow made a mistake somewhere, I would greatly appreciate it.

Thanks

B

BillM223

"the deductions summary screen"

The summary screens that are in the TurboTax interview don't necessarily show you what you think they might.

For example, There are two ways for HSA contributions to be a tax benefit: (1) as an exclusion from income, and (2) as an adjustment to gross income. The difference is where these things happen.

When you show HSA contributions on your W-2 in box 12 with a code of W, this is an exclusion, in that this code W amount is removed from Wages in boxes 1, 3, and 5 before your W-2 is printed. Because the HSA contribution is never IN your income, it doesn't show up as a deduction anywhere.

On the other hand, there is on line 13 of Schedule 1 (1040) an actual HSA deduction from gross income. This is for any contributions you make directly to the HSA custodian, not through your employer.

What's the difference? The exclusion on your W-2 is ALSO an exclusion from Social Security and Medicare taxes, whereas the deduction is only from federal income tax. So not only is the payroll deduction easy, it also saves you more money than the deduction does.

That Summary screen dhows only the deduction and not the exclusion. Evidently you had a $390 deduction in 2020 but no deduction for 2021, because all of your contributions were through your employer, which is better for you.

As for the State and Local taxes, I don't know what number it is showing, but as with the HSA, the only numbers that mean something are the numbers on your tax return. After you do your state, go look at those State and Local numbers again - they will probably be different.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"

S

Scott_NAuthor

Hi,

Thanks for the reply to my question. We have always only contributed to our HSAs from our paychecks through our employers. The $390 seemed to match what was on form 1099-SA for 2020. That's why I was confused that this line item didn't show the money on this year's 1099-SA form which was roughly $120 for 2021. Or perhaps I made an error entering it?

Any clarifications you can provide is welcomed.

Thanks again,

Scott N

B

BillM223

The 1099-SA reports on distributions from your HSA - it has nothing to do with contributions to your HSA.

Distributions are normally when you spend money from your HSA for qualified medical expenses.

Doing the 1099-SA amounts on the Summary screen is really not a good idea, because what it is referring to is the fact that the amount on the 1099-SA MIGHT be taxable income, if you tell TurboTax that this amount was not for qualified medical expenses. But since most taxpayers don't understand HSAs very well and certainly don't think of HSA stuff as being taxable, putting it on the Summary just leads to confusion.

Did you have excess HSA contributions in either 2020 or 2021? No? Then this is probably not a problem.

**Say "Thanks" by clicking the thumb icon in a post**Mark the post that answers your question by clicking on "Mark as Best Answer"