IRS Instruction 1099-SA and 5498-SA – Health Savings Accounts (HSAs), Archer Medical Savings Accounts (Archer MSAs), and Medicare Advantage MSAs (MA MSAs) offer tax-advantaged ways to save for medical expenses. However, managing these accounts involves specific IRS reporting requirements, primarily through Forms 1099-SA and 5498-SA. These forms ensure accurate tracking of distributions and contributions, helping account holders and the IRS maintain compliance. In this SEO-optimized guide, we’ll break down the purpose of IRS Instruction 1099-SA and 5498-SA, who must file them, key deadlines, how to complete the forms, penalties for non-compliance, and recent updates as of the December 2026 revision. Whether you’re a trustee, custodian, or account holder, understanding these instructions is crucial for smooth tax filing.
What Is Form 1099-SA? Distributions From an HSA, Archer MSA, or Medicare Advantage MSA
Form 1099-SA is used to report distributions from an HSA, Archer MSA, or MA MSA. This includes payments made directly to medical service providers or to the account holder. A separate form is required for each type of plan, ensuring precise reporting of taxable and non-taxable distributions.
Key scenarios for using Form 1099-SA include:
- Reporting gross distributions in Box 1, which encompasses the total amount withdrawn, including any earnings reported in Box 2.
- Noting earnings on excess contributions in Box 2, calculated per IRS regulations if applicable.
- Indicating distribution codes in Box 3, such as Code 1 for normal distributions, Code 2 for excess contributions, or Code 6 for death distributions to a non-spouse beneficiary.
- Entering the fair market value (FMV) on the date of death in Box 4 for applicable death distributions.
- Checking the appropriate box in Box 5 to specify if the distribution is from an HSA, Archer MSA, or MA MSA.
Account holders receive this form to report distributions on their personal tax returns, often using it alongside Form 8889 for HSAs.
What Is Form 5498-SA? HSA, Archer MSA, or Medicare Advantage MSA Information
Form 5498-SA provides details on contributions, rollovers, and the FMV of an HSA, Archer MSA, or MA MSA. It’s filed for each person maintaining such an account, with a separate form per plan type. This form helps verify tax-deductible contributions and ensures accurate year-end valuations.
Important boxes on Form 5498-SA include:
- Box 1: Employee or self-employed person’s Archer MSA contributions made in the calendar year and through April 15 of the following year.
- Box 2: Total contributions for the year, including qualified HSA funding from IRAs but excluding rollovers.
- Box 3: Contributions made in the subsequent year for the prior calendar year.
- Box 4: Rollover contributions, such as from one Archer MSA to another or IRA-to-HSA transfers.
- Box 5: FMV of the account as of December 31.
- Box 6: Checkbox to identify the account type (HSA, Archer MSA, or MA MSA).
No Form 5498-SA is needed if the account has a zero FMV and no contributions or rollovers occurred.
Who Must File Forms 1099-SA and 5498-SA?
Trustees or custodians of HSAs, Archer MSAs, or MA MSAs are responsible for filing these forms. This includes banks, credit unions, or other financial institutions managing these accounts. Account holders do not file these forms themselves but use the information provided to complete their tax returns, such as reporting on Form 8889.
For death of an account holder, specific rules apply: If the beneficiary is a spouse, the account transfers; otherwise, it may cease being an MSA, requiring FMV reporting.
Filing Deadlines for IRS Forms 1099-SA and 5498-SA
- Form 1099-SA: Must be furnished to recipients by January 31 of the year following the distribution and filed with the IRS by the same date if paper filing, or March 31 for electronic filing (refer to Pub. 1099 for exact details).
- Form 5498-SA: Filed with the IRS and furnished to participants by May 31 (or the next business day if it falls on a weekend or holiday).
Electronic filing is mandatory for 10 or more returns, using the IRS’s Information Returns Intake System (IRIS).
How to Complete and File Forms 1099-SA and 5498-SA?
Follow the box-by-box guidance above, ensuring accurate recipient information, TINs, and account numbers. Use the April 2025 revision for Form 1099-SA and December 2026 for Form 5498-SA when reporting 2026 information in 2027. Do not report trustee-to-trustee transfers or mistaken distributions repaid by the tax due date.
For HSA closures under the USA PATRIOT Act due to identification issues, report as excess contributions with Code 2.
Penalties for Non-Compliance With IRS Instructions
Failure to file, furnish statements, or provide correct TINs can result in penalties outlined in Pub. 1099, including fines for late filing or incorrect information. Backup withholding may also apply in certain cases.
Recent Changes and Updates to Forms 1099-SA and 5498-SA
The latest instructions (December 2026) include separated address fields on Form 5498-SA for better accuracy. Continuous-use revisions allow these forms for 2026 and beyond until superseded. The IRS updated draft instructions in December 2025, emphasizing e-filing thresholds.
Common FAQs About IRS Forms 1099-SA and 5498-SA
1. What if I receive a Form 1099-SA for an HSA distribution?
Use it to report on Form 8889; qualified medical expenses are tax-free.
2. Do I need to file Form 5498-SA if there were no contributions?
No, if the FMV is zero and no activity occurred.
3. How do I correct a mistaken distribution on Form 1099-SA?
Repay by the tax due date if due to reasonable cause; correct the form if already filed.
For the most current details, visit IRS.gov or consult a tax professional. This guide is based on official IRS resources to help you navigate HSA tax reporting effectively.