Instructions for Recipient
Distributions from a health savings account (HSA), Archer medical savings
account (MSA), or Medicare Advantage (MA) MSA are reported to you on
Form 1099-SA. File Form 8853 or Form 8889 with your Form 1040 to report a
distribution from these accounts even if the distribution isn't taxable. The payer
isn't required to compute the taxable amount of any distribution.
An HSA or Archer MSA distribution isn't taxable if you used it to pay qualified medical
expenses of the account holder or eligible family member or you rolled it over. An HSA
may be rolled over to another HSA; an Archer MSA may be rolled over to another Archer
MSA or an HSA. An MA MSA isn't taxable if you used it to pay qualified medical
expenses of the account holder only. If you didn't use the distribution from an HSA,
Archer MSA, or MA MSA to pay for qualified medical expenses, or in the case of an HSA
or Archer MSA, you didn't roll it over, you must include the distribution in your income
(see Form 8853 or Form 8889). Also, you may owe a penalty.
You may repay a mistaken distribution from an HSA no later than April 15
following the first year you knew or should have known the distribution was a
mistake, providing the trustee allows the repayment.
For more information, see the Instructions for Form 8853 and the Instructions
for Form 8889. Also see Pub. 969.
Recipient's taxpayer identification number (TIN). For your protection, this form
may show only the last four digits of your TIN (SSN, ITIN, ATIN, or EIN). However,
the issuer has reported your complete identification number to the IRS.
Spouse beneficiary. If you inherited an Archer MSA or MA MSA because of the death of
your spouse, special rules apply. See the Instructions for Form 8853. If you inherited an
HSA because of the death of your spouse, see the Instructions for Form 8889.
Estate beneficiary. If the HSA, Archer MSA, or MA MSA account holder dies
and the estate is the beneficiary, the fair market value (FMV) of the account on
the date of death is includible in the account holder’s gross income. Report the
amount on the account holder’s final income tax return.
Nonspouse beneficiary. If you inherited the HSA, Archer MSA, or MA MSA
from someone who wasn't your spouse, you must report as income on your tax
return the FMV of the account as of the date of death. Report the FMV on your
tax return for the year the account owner died even if you received the
distribution from the account in a later year. See the Instructions for Form 8853
or the Instructions for Form 8889. Any earnings on the account after the date of
death (box 1 minus box 4 of Form 1099-SA) are taxable. Include the earnings on
the “Other income” line of your tax return.
Account number. May show an account or other unique number the payer
assigned to distinguish your account.
Box 1. Shows the amount received this year. The amount may have been a
direct payment to the medical service provider or distributed to you.
Box 2. Shows the earnings on any excess contributions you withdrew from an HSA
or Archer MSA by the due date of your income tax return. If you withdrew the
excess, plus any earnings, by the due date of your income tax return, you must
include the earnings in your income in the year you received the distribution even if
you used it to pay qualified medical expenses. This amount is included in box 1.
Include the earnings on the “Other income” line of your tax return. An excise tax of
6% for each tax year is imposed on you for excess individual and employer
contributions that remain in the account. See Form 5329, Additional Taxes on
Qualified Plans (Including IRAs) and Other Tax-Favored Accounts.
Box 3. These codes identify the distribution you received: 1—Normal
distribution; 2—Excess contributions; 3—Disability; 4—Death distribution other
than code 6; 5—Prohibited transaction; 6—Death distribution after year of death
to a nonspouse beneficiary.
Box 4. If the account holder died, shows the FMV of the account on the date of death.
Box 5. Shows the type of account that is reported on this Form 1099-SA.
Future developments. For the latest information about developments related to
Form 1099-SA and its instructions, such as legislation enacted after they were
published, go to www.irs.gov/Form1099SA.
