2023 Federal Form 8889 - Health Savings Accounts (HSAs)

Form 8889 is used to report Health Savings Account (HSA) activities, including contributions, deductions, distributions, and related tax obligations. HSAs are accounts established for qualified medical expenses, providing tax advantages for eligible individuals.

Who Must File?

  1. If contributions were made to your HSA in 2023 (by you, your employer, or on your behalf).
  2. If you received HSA distributions in 2023.
  3. If you need to report income due to ineligibility during the testing period.
  4. In the case of acquiring an HSA through the death of the account beneficiary.

Eligible Individual

  • Must have a high deductible health plan (HDHP).
  • No other health coverage except certain disregarded coverage.
  • Cannot be enrolled in Medicare or be someone else's dependent.
  • Eligibility is not lost if receiving Veterans Affairs benefits for a service-connected disability.

What is a Last-month Rule?

  • If eligible on the first day of the last month of the tax year, considered eligible for the entire year.
  • Testing period ensures maintaining eligibility; failure results in income inclusion and a 10% additional tax.

Account Beneficiary

  • The individual on whose behalf the HSA was established.

Qualified Medical Expenses

  • Include unreimbursed medical expenses deductible on Schedule A.
  • Cover personal protective equipment and COVID-19-related expenses.
  • Certain nutrition, wellness, and general health costs may be reimbursed.

Insurance Premiums

  • Generally not qualified medical expenses, except for specific cases like long-term care, COBRA, and Medicare premiums for those 65 and older.

For the current year's Form 8889, click here.