Form 1099-SA: Quickly File Online and Distribution Codes
Effortless Online Filing for Health Savings Account Distributions and Codes
E-File Form 1099-SA Online with Tax2efile
Form 1099-SA, to report the distributions made from an:
- Health savings account (HSA).
- Archer Medical Savings Account (Archer MSA).
- Medicare Advantage Medical Savings Account (MA MSA).
The distribution may have been paid directly to a medical service provider or to the account holder and available at the end of January. A separate return must be filed for each plan type. HSA is reported on Box 12 with Code W in the W-2 Form, which includes the medical expenses. The filer may file more than one tax return 1099-SA when they have multiple accounts. This includes the total amount of the distribution, the total earnings distributed with any excess HSA or Archer MSA contributions, appropriate distribution code for the types of distribute n, FMV of the account on the date of death, and a checkbox to choose the type of distribution or the type of account to be chosen by the filer. The distributions will be taxed at a rate of 20%.
Distribution Codes for Distributions from HSAs, Archer MSAs, and Medicare Advantage MSA’s
| Code | Explanation |
|---|---|
| 1—Normal distributions | Use this code for normal distributions to the account holder and any direct payments to a medical service provider. Use this code if no other code applies. |
| 2—Excess contributions | Use this code for distributions of excess HSA or Archer MSA contributions to the account holder. |
| 3—Disability | Use this code if you made distributions after the account holder was disabled (see section 72(m)(7)). |
| 4—Death distribution other than code 6 | Use this code for payments to a decedent’s estate in the year of death. Also, use this code for payments to an estate after the year of demise. Do not use with code 6. |
| 5—Prohibited transaction | See sections 220(e)(2) and 223(e)(2). |
| 6—Death distribution after a year of demise to a non-spouse beneficiary | Use this code for payments to a decedent’s non-spouse beneficiary, other than an estate, after the year of demise. Do not use with code 4. |
What is 1099-SA Form?
The 1099-SA form is utilized to report distributions from Health Savings Accounts (HSAs), Archer Medical Savings Accounts (MSAs), or Medicare Advantage Medical Savings Accounts (MSAs). This form is crucial for reimbursing distributions made for qualified medical expenses, as recognized by the IRS. Taxpayers need to specify the distributed amounts and note any taxable amounts to ensure accurate reporting of their medical expenses.
How to File Form 1099-SA?
The 1099-SA tax return is to report the distributions made from a Health Savings Account (HSA), Archer Medical Savings Account (Archer MSA), or Medicare Advantage Medical Savings Account (MA MSA). The filer must keep all receipts and records of medical expenses paid with their funds to document that distributions have been made exclusively for qualified medical expenses and submit them to the IRS by filing it.
Qualified Medical Expenses include
- Most medical care and services
- Dental and vision care
- Prescription drugs and some over-the-counter drugs that are not covered by insurance
Watch our step-by-step video on How to E-File IRS Form 1099-SA with Tax2efile
Who Must File Form 1099-SA?
Form 1099-SA is beneficial in many ways, it’s always good to have assisting documents at tax time. Some filers use their HSA primarily to pay for their current healthcare expenses. Others use it as a long-term savings tool, investing the funds for tax-free earnings. There is no deadline for using the money. For your information, withdrawals for eligible medical expenses are tax-free at any age. The filer can use the fund for their medical expenses. In the tax year, an HSA, Archer MSA or MA MSA owner dies, generally, the spouse / any person related to the owner must file a Form 5498-SA and furnish a statement for the decedent.
When is the Form 1099-SA Deadline?
| Filing Type | Deadline |
|---|---|
| Recipient copy | January 31st |
| IRS Paper Filing | February 28th |
| IRS Electronic Filing | March 31st |
Note: If the due date/deadline falls on a Saturday, Sunday, or federal holiday, the filer will need to E-file on the next business day.
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Frequently Ask Questions
Find answers to commonly asked questions about our products and services.
1099-SA is used by government agency to inform you of funds you have received that you may need to report on your federal income tax return.
Federal, state, or local governments file this form if they made payments of: Unemployment compensation. State or local income tax refunds, credits, or offsets. Reemployment trade adjustment assistance (RTAA) payments.
Required details to file Form 1099-SA may be: details of Payer and Payee Information, Tin of Payer, Recipient Information, Tin of, Recipient.
Yes, Tax2efile offers a bulk upload feature that allows the user to upload all the payers to an excel sheet for a faster process.
Tax2efile allows you to correct a mistake to the payers’ information for TINs, Names & amounts.
Form 1099-SA is used to report distributions from Health Savings Accounts (HSAs), Archer Medical Savings Accounts (Archer MSAs), and Medicare Advantage Medical Savings Accounts (MA MSAs). These distributions can include withdrawals for qualified medical expenses, reimbursements, or other authorized distributions from these accounts.
Yes, Tax2efile offers printing and mailing service! Our dedicated team will print and mail out each form you filed.
Using our fast electronic service, you can complete your filing within 5 minutes.
To file Form 1099-SA for a single return the filing fee is $3.25.
The IRS requires Form 1099-SA to be submitted by February 28 through the mail and by March 31 if you file the form electronically however, recipients’ copy should be mailed by January 31.
Failure to file the 1099 form by the deadline may result in IRS penalties. The penalty can be from $60 per 1099 Form, the maximum penalty can be up to $630,500. If you submit Form more than 31 days to before August 1, the penalty increases to $120 per 1099 Form and maximum penalty up to $1,891,500. If you file after August 1, the penalty can be from $310 per 1099 Form and maximum penalty up to $3,783,000. Additionally, there are penalties for failure to furnish the payee statement.
Yes, there are specific IRS codes and indicators required for reporting distributions on Form 1099-SA. Tax2efile offers guidance on selecting the appropriate codes and indicators based on the nature of the distributions being reported, helping users accurately complete their Form 1099-SA filings.
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