IRS 8853 Explained

What is IRS 8853?

IRS 8853 is a tax form used to report Health Savings Accounts (HSAs) and Archer Medical Savings Accounts (MSAs). This form is necessary for individuals or entities who have made contributions to these accounts or have distributions from them within a given tax year. Essentially, IRS 8853 helps ensure that the tax implications related to HSAs and MSAs are accurately reported and understood.

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Purpose of IRS 8853

The primary purpose of IRS 8853 is to track contributions and distributions made to HSAs and MSAs. These accounts offer tax benefits that can help individuals save money on medical expenses. By requiring this form, the IRS facilitates proper reporting, ensuring that individuals take advantage of these tax benefits correctly. The existence of IRS 8853 helps maintain compliance with tax regulations related to health savings accounts, thereby protecting both the taxpayer and the government.

Where is IRS 8853 used and by whom?

IRS 8853 is commonly used by individuals who maintain HSAs or MSAs. It is also relevant for businesses that offer such plans to their employees. Here are a few typical user groups and scenarios:

1.

Individuals who have a qualified high-deductible health plan (HDHP) and contribute to an HSA.
2.

Self-employed individuals who utilize MSAs for medical savings.
3.

Employers providing HSAs or MSAs as part of employee benefits packages.
4.

Tax professionals assisting clients with health savings accounts or medical savings accounts.

Step-by-step: how to fill out IRS 8853

Filling out IRS 8853 requires careful attention to the form's sections. Here’s a step-by-step guide:

1.

Gather all necessary information regarding your HSA or MSA contributions and distributions.
2.

Section I: Report your contributions. This includes the amount contributed to your HSA or MSA during the tax year.
3.

Section II: Report any distributions. Clearly specify how much money was taken out and for what purpose.
4.

Section III: Indicate any rollover amounts if applicable. Ensure accurate reporting of rollovers to avoid tax penalties.
5.

Double-check all entries for accuracy.

Using platforms like pdfFiller can streamline this process. You can easily fill out, edit, and eSign your tax forms online.

Who is required to complete IRS 8853?

Individuals and entities that must complete IRS 8853 generally include:

1.

Anyone who made contributions to an HSA or MSA during a tax year.
2.

Individuals who received distributions from their HSA or MSA.
3.

Employers providing HSAs or MSAs as part of their employee compensation packages.

Failure to complete this form in the applicable situations can lead to complications with your tax return.

Information you need to complete IRS 8853

To properly fill out IRS 8853, you need the following information:

1.

Your HSA or MSA account numbers.
2.

Total contributions made during the tax year.
3.

Total distributions taken from the account.
4.

Documentation for any rollovers.
5.

Details on the eligible high-deductible health plan, if applicable.

How to submit IRS 8853

IRS 8853 can be submitted in several ways:

1.

Online through e-filing services that cater to electronic tax form submissions.
2.

By mail to the IRS office that handles your tax return.
3.

Verify that you’ve met any deadlines associated with submission to avoid penalties.

Make sure that you retain a copy of the submitted form for your records.

When to update or refile IRS 8853

There are specific circumstances where you may need to update or refile IRS 8853:

1.

If there are changes to your contributions or distributions after filing.
2.

In the event of a change in your high-deductible health plan or eligibility status.
3.

If you notice errors or omissions after submitting the original form.

Keeping your records accurate is crucial for maintaining compliance with tax laws.

What happens if you don’t file IRS 8853?

Neglecting to file IRS 8853 can result in various consequences, including:

1.

Accidental tax penalties and fines imposed by the IRS.
2.

Loss of eligible tax benefits related to HSAs or MSAs.
3.

Pursued audits if discrepancies are found in your tax account.

Therefore, timely and accurately submitting IRS 8853 is essential to avoid these potential issues.

Fill out IRS 8853 online

Get the latest version of the form and complete it in minutes.

Get IRS 8853

Frequently Asked Questions About the IRS 8853

What is the purpose of IRS 8853?

The IRS 8853 form is used to report contributions to and distributions from health savings accounts (HSAs) and medical savings accounts (MSAs). This form helps taxpayers identify eligible contributions and withdrawals related to these accounts. Understanding IRS 8853 is essential for accurate tax reporting and potential tax benefits associated with HSAs and MSAs.

Who needs to file IRS 8853?

Individuals who have made contributions to an HSA or MSA must file IRS 8853 to report those transactions. If you've received distributions from these accounts for eligible medical expenses, you are also required to submit this form. Filing IRS 8853 ensures that you remain compliant with tax laws and can enjoy potential tax advantages related to your contributions.

What information is required on IRS 8853?

IRS 8853 requires details about the health savings accounts or medical savings accounts you manage. This includes contributions made during the tax year, distributions from the accounts, and any eligible medical expenses paid using these funds. It's important to provide accurate information on IRS 8853 to avoid errors and ensure proper tax treatment.

How do I fill out IRS 8853 correctly?

To fill out IRS 8853, begin by gathering all relevant details about your HSA or MSA transactions for the tax year. Carefully enter contributions, distributions, and any necessary deductions in the appropriate sections of the form. It's advisable to refer to the IRS instructions for IRS 8853 or seek professional assistance to ensure accuracy in your filing.

Where can I find IRS 8853 online?

You can find IRS 8853 on the official IRS website, which offers downloadable versions of the form along with detailed instructions. Many tax preparation software programs also include the capability to fill out IRS 8853 if you're filing electronically. Accessing IRS 8853 online makes it easier to manage your tax documents.

What are the consequences of not filing IRS 8853?

Failing to file IRS 8853 when required can lead to penalties and interest charges on any taxes owed. It may also raise red flags during an audit, potentially leading to further scrutiny of your financial records. To avoid complications, ensure timely submission of IRS 8853 along with your other tax documents.

Can I amend IRS 8853 after I file my tax return?

Yes, you can amend IRS 8853 after filing your tax return if you discover errors or omissions. To do this, you would need to file an amended tax return using Form 1040-X and include the corrected IRS 8853. It is crucial to correct any inaccuracies on IRS 8853 to ensure compliance with tax regulations.

Is IRS 8853 required for all taxpayers?

Not all taxpayers need to file IRS 8853; it is specifically for those who have contributed to or withdrawn from HSAs or MSAs. If you are not participating in these accounts, you will not be required to submit IRS 8853. Review your tax situation to determine if this form applies to you.

What should I do if I lose my IRS 8853 form?

If you lose your IRS 8853 form, you can easily recreate it by using the information from your tax records, such as bank statements or account summaries. Alternatively, you can download a new copy of IRS 8853 from the IRS website. Keeping a record of this form is essential for your tax history and future filings.

Are there any exemptions for filing IRS 8853?

Certain situations may exempt you from filing IRS 8853, such as not having any contributions or distributions in the tax year. Additionally, if you do not qualify for an HSA or MSA, you may not need to file the form. However, it's best to confirm your specific situation against IRS guidelines regarding exemptions from IRS 8853.

Author:

by Iryna Marchuk

Lead Writer/Blogs Manager at airSlate

Disclaimer: This content is for informational purposes only. It is not legal or other professional advice. airSlate provides this material on an "as-is" basis and disclaims all representations, guarantees, or warranties, whether express, implied, or statutory, including but not limited to warranties of merchantability, fitness for a particular purpose, or accuracy.