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Old 08-11-2008, 09:54 PM
12 posts, read 49,462 times
Reputation: 11


I hope someone can help me.

I'm filing my 2007 taxes. (I'm filing late but I'm getting a small return.) And I have a question on my HSA.

In October 2007, I put $1,500 into an HSA. I later decided I did not want to invest the money in an HSA so I withdrew all the money plus $7 in interest. But I did this before the April 15 deadline for filing.

The bank where I opened the HSA sent me a 5498-SA FORM for the money I withdrew ($1507.00).

Two questions:

1) Will I be penalized for withdrawing the money early if I took it out in the same tax year. (I would have had to take money out anyway because I put in too much, according to when I started getting health premiums.)

2) Turbotax has no Form 5498-SA -- so how do I enter this into my tax forms?

Thank in advance for your help!



P.S. Please, if you respond, keep the advice on topic.
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Old 08-12-2008, 07:19 AM
3,447 posts, read 8,606,771 times
Reputation: 5338
Distributions From an HSA
You will generally pay medical expenses during the year without being reimbursed by your HDHP until you reach the annual deductible for the plan. When you pay medical expenses during the year that are not reimbursed by your HDHP, you can ask the trustee of your HSA to send you a distribution from your HSA.

You can receive tax-free distributions from your HSA to pay or be reimbursed for qualified medical expenses you incur after you establish the HSA. If you receive distributions for other reasons, the amount you withdraw will be subject to income tax and may be subject to an additional 10% tax. You do not have to make distributions from your HSA each year.

From IRS.gov Pub. 969
Form 5498-SA is not filed by an individual. It is similiar to a 1099 or W-2 and is filed electronically usually and has to be scanned if not so a special form is needed. The data on the form is entered someplace else on the tax return like the HSA form. The 5498-SA should have instructions or you should be able to find info on the irs.gov page for the type of item it is.
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Old 08-13-2008, 10:49 PM
12 posts, read 49,462 times
Reputation: 11
Thanks, but I'm not sure you answered my question.

Question: If I put $1,500 in my HSA in November 2007 and then withdraw the entire amount on April 14, 2008 BEFORE the tax deadline -- is that amount still subject to the additional 10% tax?

(I'm sure it is, because what the hell, they seem to be getting me every way they can lately.)

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