HSA, Archer MSA, or Medicare Advantage MSA Information

2014

Department of the Treasury
Internal Revenue Service

Instructions for Forms
1099-SA and 5498-SA

Distributions From an HSA, Archer MSA, or Medicare Advantage MSA, and HSA,
Archer MSA, or Medicare Advantage MSA Information
Section references are to the Internal Revenue Code unless
otherwise noted.

Future Developments

For the latest information about developments related to Forms
1099-SA and 5498-SA and their instructions, such as legislation
enacted after they were published, go to www.irs.gov/form1099sa
and www.irs.gov/form5498sa.

What's New
Truncating recipient's identification number on paper payee
statements. Pursuant to proposed regulations § 301.6109-4
(REG-148873-09), all filers of these forms may truncate a recipient's
(Form 1099-SA) or participant's (Form 5498-SA) identification
number, such as their social security number (SSN), individual
taxpayer identification number (ITIN), or adoption taxpayer
identification number (ATIN), on payee statements. See part M in
the 2014 General Instructions for Certain Information Returns.

Reminder
General instructions. In addition to these specific instructions, you
should also use the 2014 General Instructions for Certain
Information Returns. Those general instructions include information
about the following topics.
Who must file (nominee/middleman).
When and where to file.
Electronic reporting requirements.
Corrected and void returns.
Statements to recipients.
Taxpayer identification numbers.
Backup withholding.
Penalties.
Other general topics.
You can get the general instructions from www.irs.gov/
form1099sa, www.irs.gov/form5498sa, or by calling
1-800-TAX-FORM (1-800-829-3676).

Specific Instructions for Form
1099-SA

File Form 1099-SA, Distributions From an HSA, Archer MSA, or
Medicare Advantage MSA, to report distributions made from an
HSA, Archer MSA, or Medicare Advantage MSA (MA MSA). The
distribution may have been paid directly to a medical service
provider or to the account holder. A separate return must be filed for
each plan type.

Transfers. Do not report a trustee-to-trustee transfer from one
Archer MSA or MA MSA to another Archer MSA or MA MSA, one
Archer MSA to an HSA, or from one HSA to another HSA. For
reporting purposes, contributions and rollovers do not include
transfers.
HSA mistaken distributions. If amounts were distributed during
the year from an HSA because of a mistake of fact due to
reasonable cause, the account beneficiary may repay the mistaken
distribution no later than April 15 following the first year the account
beneficiary knew or should have known the distribution was a
Sep 24, 2013

mistake. For example, the account beneficiary reasonably, but
mistakenly, believed that an expense was a qualified medical
expense and was reimbursed for that expense from the HSA. The
account beneficiary then repays the mistaken distribution to the
HSA.
Under these circumstances, the mistaken distribution is not
included in gross income, is not subject to the additional 20% tax,
and the repayment is not subject to the excise tax on excess
contributions. Do not treat the repayment as a contribution on Form
5498-SA.
As the trustee or custodian, you do not have to allow
beneficiaries to return a mistaken distribution to the HSA.
However, if you do allow the return of the mistaken
distribution, you may rely on the account beneficiary's statement that
the distribution was in fact a mistake. See Notice 2004-50, 2004-33
I.R.B. 196, Q/A-76, available at www.irs.gov/irb/2004-33_IRB/
ar08.html. Do not report the mistaken distribution on Form 1099-SA.
Correct any filed Form 1099-SA with the IRS and the account
beneficiary as soon as you become aware of the error. See
Corrected Returns on Paper Forms in the 2014 General Instructions
for Certain Information Returns for more information.

TIP

Death of Account Holder
Archer MSAs and MA MSAs. When the account holder dies and
the designated beneficiary is the spouse:
The spouse becomes the account holder of the Archer MSA,
An MA MSA is treated as an Archer MSA of the spouse for
distribution purposes, and
Distributions from these accounts are subject to the rules that
apply to Archer MSAs.
If the designated beneficiary is not the spouse or there is no
named beneficiary, the account ceases to be an MSA as of the date
of death and the fair market value (FMV) on that date is reported.
If there is more than one recipient, the FMV should be allocated
among them, as appropriate.
If the beneficiary is the estate, enter the estate's name and
taxpayer identification number (TIN) in place of the recipient's on the
form.
Distribution in year of death. If you learn of the account
holder's death and make a distribution to the beneficiary in the year
of death, issue a Form 1099-SA and enter in:
Box 1, the gross distribution;
Box 3, code 4 (see Box 3. Distribution Code, later); and
Box 4, the FMV of the account on the date of death.
Distribution after year of death. If you learn of the death of the
account holder and make a distribution after the year of death, issue
a Form 1099-SA in the year you learned of the death of the account
holder. Enter in:
Box 1, the gross distribution;
Box 3, one of the following codes (see Box 3. Distribution Code,
later):
1—if the beneficiary is the spouse,
4—if the beneficiary is the estate, or
6—if the beneficiary is not the spouse or estate;
Box 4, the FMV of the account on the date of death, reduced by
any payments from the HSA made for the decedent's qualified
medical expenses, if paid within one year after death.

Cat. No. 38470S

HSAs. When the account holder dies and:
The designated beneficiary is the surviving spouse, the spouse
becomes the account holder of the HSA.
The spouse is not the designated beneficiary, the account ceases
to be an HSA on the date of the account holder's death. The FMV of
the account as of the date of death is required to be reported in
box 4. Follow the rules and coding above under Distribution in year
of death and Distribution after year of death.

Statements to Recipients
If you are required to file Form 1099-SA, you must provide a
statement to the recipient. For more information about the
requirement to furnish a Form 1099-SA or acceptable substitute
statement to recipients, see part M in the 2014 General Instructions
for Certain Information Returns.

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. Also, see Distribution after
year of death, earlier.

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 death. Do not
use with code 6. See Death of Account
Holder, earlier.

5—Prohibited transaction

See sections 220(e)(2) and 223(e)(2).

6—Death distribution after
year of death to a
nonspouse beneficiary

Use this code for payments to a
decedent's nonspouse beneficiary,
other than an estate, after the year of
death. Do not use with code 4.

Account Number
The account number is required if you have multiple accounts for a
recipient for whom you are filing more than one Form 1099-SA.
Additionally, the IRS encourages you to designate an account
number for all Forms 1099-SA that you file. See part L in the 2014
General Instructions for Certain Information Returns.

Box 1. Gross Distribution

Box 4. FMV on Date of Death

Enter the total amount of the distribution. Include any earnings
separately reported in box 2. You are not required to determine the
taxable amount of a distribution. Do not report a negative amount in
box 1. Do not report the withdrawal of excess employer contributions
(and the earnings on them) returned to an employer as a distribution
from an employee's HSA. Do not report excess MA MSA
contributions returned to the Secretary of Health and Human
Services or his or her representative.

Enter the FMV of the account on the date of death. See Death of
Account Holder, earlier.

Box 5. Checkbox
Check the box to indicate if this distribution was from an HSA,
Archer MSA, or MA MSA.

Specific Instructions for Form
5498-SA

Box 2. Earnings on Excess Contributions
Enter the total earnings distributed with any excess HSA or Archer
MSA contributions returned by the due date of the account holder's
tax return. Include this amount in box 1. Report earnings on other
distributions only in box 1.

File Form 5498-SA, HSA, Archer MSA, or Medicare Advantage MSA
Information, with the IRS on or before June 1, 2015, for each person
for whom you maintained an HSA, Archer MSA, or Medicare
Advantage MSA (MA MSA) during 2014. You are required to file if
you are the trustee or custodian of an HSA, Archer MSA, or MA
MSA. A separate form is required for each type of plan.

For HSAs and Archer MSAs, if you are reporting earnings
on a distribution of excess contributions, use the method
under Regulations section 1.408-11 for calculating the net
income attributable to IRA contributions that are distributed as a
returned contribution. If the amount in box 2 includes earnings on
excess contributions, enter distribution code 2 in box 3.

TIP

For HSA or Archer MSA contributions made between January 1,
2015, and April 15, 2015, you should obtain the participant's
designation of the year for which the contributions are made.
For repayment of a mistaken distribution amount, see HSA
mistaken distributions, earlier. Do not treat the repayment as a
contribution on Form 5498-SA.

Box 3. Distribution Code
Enter the appropriate distribution code from the following list that
shows the type of distribution.

Rollovers
You must report the receipt of a rollover from one Archer MSA to
another Archer MSA, and receipt of a rollover from an Archer MSA
or an HSA to an HSA in box 4.

Transfers
Do not report a trustee-to-trustee transfer from one Archer MSA or
MA MSA to another Archer MSA or MA MSA, from an Archer MSA
to an HSA, or from one HSA to another HSA. For reporting
purposes, contributions and rollovers do not include these transfers.
However, see box 2, earlier, for the reporting of a trustee-to-trustee
transfer from an IRA to an HSA.

Total Distribution, No Contributions
Generally, if a total distribution was made from an HSA or Archer
MSA during the year and no contributions were made for that year,
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Instructions for Forms 1099-SA and 5498-SA (2014)

you need not file Form 5498-SA nor furnish a statement to the
participant to reflect that the FMV on December 31 was zero.

Box 1. Employee or Self-Employed Person's
Archer MSA Contributions Made in 2014 and 2015
for 2014

Death of Account Holder
In the year an HSA, Archer MSA, or MA MSA owner dies, generally
you must file a Form 5498-SA and furnish a statement for the
decedent. If the designated beneficiary is the spouse:
The spouse becomes the account holder of the HSA or Archer
MSA.
An MA MSA is treated as an Archer MSA of the spouse for
distribution purposes, but no new contributions may be made to the
account.

Enter the employee's or self-employed person's regular
contributions to the Archer MSA made in 2014 and through April 15,
2015, for 2014. Report gross contributions, including any excess
contributions, even if the excess contributions were withdrawn. No
HSA information is to be reported in box 1.

Box 2. Total Contributions Made in 2014
Enter the total HSA or Archer MSA contributions made in 2014.
Include any contribution made in 2014 for 2013. Also include
qualified HSA funding distributions (trustee-to-trustee transfers from
an IRA to an HSA under section 408(d)(9)) received by you during
2014. Any excess employer contributions (and the earnings on
them) withdrawn by the employer pursuant to Notice 2008-59, Q/A
24, available at www.irs.gov/irb/2008-29_IRB/ar11.html, should not
be reported as a contribution. You may, but you are not required to,
report the total MA MSA contributions the Secretary of Health and
Human Services or his or her representative made in 2014. Do not
include amounts reported in box 4.

If the designated beneficiary is not the spouse or there is no
designated beneficiary, the account ceases to be an HSA, Archer
MSA, or MA MSA.

Statements to Participants
If you are required to file Form 5498-SA, you must provide a
statement to the participant (generally Copy B) by June 1, 2015. You
may, but you are not required to, provide participants with a
statement of the December 31, 2014, FMV of the participant's
account by January 31, 2015. For more information about
statements to participants, see part M in the 2014 General
Instructions for Certain Information Returns.

Box 3. Total HSA or Archer MSA Contributions
Made in 2015 for 2014

If you furnished a statement of the FMV of the account to the
participant by January 31, 2015, and no reportable contributions,
including rollovers, were made for 2014, you need not furnish
another statement (or Form 5498-SA) to the participant to report
zero contributions. However, you must file Form 5498-SA with the
IRS by June 1, 2015, to report the December 31, 2014, FMV of the
account.

Enter the total HSA or Archer MSA contributions made in 2015 for
2014.

Box 4. Rollover Contributions
Enter rollover contributions to the HSA or Archer MSA received by
you during 2014. These amounts are not to be included in box 2.

If you do not furnish another statement to the participant
because no reportable contributions were made for the
CAUTION
year, the statement of the FMV of the account must contain
a legend designating which information is being furnished to the
Internal Revenue Service.

!

Box 5. Fair Market Value of HSA, Archer MSA, or
MA MSA
Enter the FMV of the account on December 31, 2014.

Box 6. Checkbox

Account Number

Check the box to indicate if this account is an HSA, Archer MSA, or
MA MSA.

The account number is required if you have multiple accounts for a
recipient for whom you are filing more than one Form 5498-SA.
Additionally, the IRS encourages you to designate an account
number for all Forms 5498-SA that you file. See part L in the 2014
General Instructions for Certain Information Returns.

Instructions for Forms 1099-SA and 5498-SA (2014)

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