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04-17-2017 03:24 PM
HSA: How do we report HSA account maintenance fee in HRBlock software? I have received the 1099-SA showing box3 gross distribution as $47/- for the monthly fee of $3.95/- I didn't use it for medial expense, but the service provider charged this fee. So it this my taxable distribution? Block software also adds $9/- as 20% penalty to it. I no longer work for the organization that myself and employer contributed into this account with.
Is there a form/place i might be missing in the HRBlock software?
04-17-2017 08:09 PM - edited 04-17-2017 08:20 PM
The IRS specifically says that account fees are NOT to be reported as a distribution on 1099-SA. You HSA administrator has issued an incorrect form.
IRS Publication 969 specifically says,
"HSA administration and maintenance fees withdrawn by the trustee aren’t reported as distributions from the HSA.".
Your HSA bank should not issue Form 1099-SA (or any other form) for maintenance fees.