Last year, many employers implemented Health Savings Account (HSA) plans as a benefit option for 2005. Now that tax time is here, its time for those insured under these plans to settle up with Uncle Sam regarding qualified expenses incurred under these plans.
At the end of the year, you will receive a report from your Health Savings Account bank that shows money in & money out of the account. For tax time, you will need a new IRS Form 8889.
Use Form 8889 to:
• Report Health Savings Account contributions (including those made on your behalf and employer contributions).
• Figure your HSA deduction, and
• Report distributions from HSAs
As always, please consult your tax advisor regarding questions and/or the necessity of these forms.