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What is Tax Form 5498-SA?

With piles and piles of forms to choose from, having a grasp of financial nuances is crucial when filing with the IRS. You may have received tax form 5498-SA in the past. But what exactly is it?

What is 5498-SA?

Tax form 5498-SA is an informational form that tracks the contributions to Health Savings Accounts (HSA) and Medical Savings Accounts (MSA). This form doesn’t have to be filed with your income tax forms but, if you are required to file it with the IRS, it must be done by June 1st.

Do I have to file 5498-SA?

The only time you have to fill out a 5498-SA form is when you are the trustee or custodian of an MSA or HSA that benefits someone else. In this case you must report current year contributions, as well as roll over amounts. Obviously, you’ll want to make sure to file a separate form for each type of account, even if they are for the same person.

What should I include?

Let’s say the account holder reasonably misidentified a particular medical expense as meeting the HSA criteria and therefore received reimbursement for it, but that expense ended up not qualifying. The employee must repay the total amount to the HSA. Although this is a deposit to the HSA, it isn’t included in gross income, and should not be included on the 5498-SA form, but rather treated as a mistaken distribution. This also means that this deposit isn’t subject to the additional 20% tax nor the excise tax for excess contributions.

Some extra tips

If the total distribution made from an HSA or MSA during the year has no contributions for that year, you do need not to file Form 5498-SA. In the unfortunate event that the account holder passes away, don’t forget to send a copy of this form to their next of kin for reporting purposes.

For more information on filing tax form 5498-SA, visit the IRS website for more detailed instructions.