What is Tax Form 5498?

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HSAs and other health focused savings account have major tax benefits - but that also means that there are certain forms that you need to be aware of when filing your taxes. Tax Form 5498 is one of those forms you may be wondering about.

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If you’re the owner of an HSA, sometime in May (at least by June 1st) you will receive Tax Form 5498 from the trustee or administrator of your account. You may panic, because it looks like something that you should have submitted with your income taxes. Fear not, this form is only for your informational purposes.

What Tax Form 5498 Shows

To put it succinctly, tax form 5498 shows you all of the contributions made to your HSA. This form is what the trustee or administrator of your HSA (as well as Archer MSA and MA MSA) uses to report all of your contributions including the ones made by: you, your employer, your spouse or other loved one, or transfers from IRAs and rollovers from the previous year.

Here is a box-by-box guide to what you’ll see on your personal tax form 5498:

  • Box 1: Contributions to an Archer MSA in 2019 and 2020, that count towards 2019 contribution limits. If you don’t own an Archer MSA that is also administered by this trustee or administrator, this box will be blank.
  • Box 2: This box shows all contributions made in calendar year 2019 to your HSA, and includes any qualified distributions from your IRA to fund your HSA. It also includes any contributions made in 2019 which were applied to tax year 2018.
  • Box 3: Because you were able to make 2019 contributions until July 15, your 5498-SA is distributed after tax day so it reflects all contributions made in 2020 for tax year 2019.
  • Box 4: Any rollover contributions from 2019 that were received by the administrator in 2020.
  • Box 5: The fair market value of your HSA, Archer MSA or MA MSA.
  • Box 6: The correct boxes should be checked (HSA, Archer MSA, MA MSA).

What you should do with this information

The first thing you should do after receiving this form is to ensure all of the information on it is accurate. Why? Because this is the information that the trustee or administrator of your HSA has reported to the IRS. If it’s inaccurate or different than what you reported on your tax return, it could cause you massive headaches. If you see a discrepancy between what you reported on your taxes (Form 8889) and what you see on Form 5498, you should contact your trustee or administrator immediately to make sure all of your contributions have been recorded and coded correctly.

Be mindful of over-contributing to your HSA. If you contributed more than the IRS allowed for in 2019 ($3,500 for an individual and $7,000 for a family), but those excess contributions were repaid to you by your HSA trustee or administrator, they should not be included in your contribution amount for 2019. Since you have to pay income taxes on any excess contributions, in addition to a 6% tax penalty, it’s important that the number reported in Box 2 only reflects the money you left in the account.

If it was your HSA trustee or administrator who made the error, they will issue you a Corrected Form 5498. If the error was on your end, you will need to file an amended tax return.

If, after checking the information, everything looks accurate, you should keep this form with your other tax documents in the event you face any other inquiries in the future.

Unusual Circumstances

  • You took a total distribution (meaning you completely emptied your HSA) in 2019 and made zero contributions to the account. If this was the case, your trustee or administrator is not required to send you a Form 5498.
  • Your spouse was the owner of an HSA and passed away in 2019. If this occurred, you are the new owner of the HSA and will receive a Form 5498 from the HSA trustee or administrator. Something to note: if you are the designated beneficiary of an HSA but are not the deceased owner’s spouse, then the account ceases to become an HSA and you won’t receive a Form 5498.

Form 5498 is referred to as a tax form but it’s simply for your information and isn’t needed for you to file your taxes. However, it is important that it displays accurate information, for if it doesn’t, it could affect your tax liabilities. If you have any questions after receiving your Form 5498, reach out to your trustee or administrator or a tax accountant.

Disclaimer: the content presented in this article are for informational purposes only, and is not, and must not be considered tax, investment, legal, accounting or financial planning advice, nor a recommendation as to a specific course of action. Investors should consult all available information, including fund prospectuses, and consult with appropriate tax, investment, accounting, legal, and accounting professionals, as appropriate, before making any investment or utilizing any financial planning strategy.