IRS Form 8889 – Health Savings Accounts (HSAs)

IRS Form 8889 – Health Savings Accounts (HSAs) – Health Savings Accounts (HSAs) offer a powerful way to save for medical expenses while enjoying tax advantages. If you’re contributing to an HSA, taking distributions, or managing one, you’ll likely need to file IRS Form 8889. This form helps report your HSA activity and calculate deductions or taxes owed. In this guide, we’ll break down everything you need to know about Form 8889 for tax year 2025, including who must file, how to complete it, contribution limits, and recent updates.

What Is IRS Form 8889?

IRS Form 8889 is the official document used to report activity related to Health Savings Accounts (HSAs). It allows taxpayers to:

  • Report contributions made to an HSA (including your own, employer contributions, or those from others).
  • Calculate your HSA tax deduction.
  • Report distributions (withdrawals) from your HSA.
  • Determine any additional income or taxes if you fail to maintain eligibility for an HSA.

The form must be attached to your Form 1040, 1040-SR, or 1040-NR. HSAs are tax-advantaged accounts for individuals covered by a high-deductible health plan (HDHP). Contributions are tax-deductible, earnings grow tax-free, and qualified withdrawals for medical expenses are also tax-free.

Form 8889 has three main parts:

  • Part I: Focuses on contributions and your deductible amount.
  • Part II: Handles distributions and any taxes on non-qualified withdrawals.
  • Part III: Addresses income and penalties if you don’t maintain HDHP coverage.

For detailed instructions, refer to the IRS’s official guidance on completing the form.

Who Must File IRS Form 8889?

Not everyone with an HSA needs to file Form 8889, but you must submit it if any of the following apply for tax year 2025:

  • You, your employer, or anyone else made contributions to your HSA.
  • You received distributions from your HSA.
  • You failed to remain an eligible individual during a required “testing period” (e.g., under the last-month rule), requiring you to include amounts in income.
  • You inherited an HSA due to the death of the account beneficiary.

Even if you have no taxable income or other reason to file a return, you must file Form 8889 with Form 1040 if you received HSA distributions. If married filing jointly and both spouses have HSAs, each may need to file a separate Form 8889.

Eligibility for an HSA requires coverage under an HDHP with no other disqualifying health coverage (except certain disregarded types like dental or vision). You can’t be enrolled in Medicare or claimed as a dependent on someone else’s return.

2025 HSA Contribution Limits

Contribution limits for HSAs are adjusted annually for inflation. For tax year 2025:

  • Self-only coverage: Up to $4,300.
  • Family coverage: Up to $8,550.
  • Catch-up contribution: An additional $1,000 if you’re 55 or older by the end of the year (not enrolled in Medicare).

These limits include all contributions from you, your employer, or others, but exclude rollovers or qualified funding distributions from an IRA. If you’re eligible for only part of the year, prorate the limit based on the number of months you qualify.

Exceeding these limits can result in a 6% excise tax on excess contributions (reported on Form 5329). You can avoid this by withdrawing the excess plus earnings by your tax filing deadline.

Coverage Type 2025 Contribution Limit Catch-Up (Age 55+)
Self-Only $4,300 +$1,000
Family $8,550 +$1,000 (per eligible spouse)

Note: For 2026, limits increase to $4,400 (self-only) and $8,750 (family), but use 2025 figures for your 2025 return.

How to Fill Out IRS Form 8889: Step-by-Step Guide?

Filling out Form 8889 requires information from your Form W-2 (for employer contributions), Form 1099-SA (for distributions), and your HSA records. Here’s a breakdown by part.

Part I: HSA Contributions and Deduction

This section calculates your allowable deduction.

  • Line 1: Indicate your HDHP coverage type (self-only or family).
  • Line 2: Enter your personal contributions (exclude employer or rollover amounts).
  • Line 3: Enter your maximum contribution limit (prorated if not eligible all year).
  • Lines 4-12: Adjust for Archer MSA contributions, employer contributions, and qualified funding distributions.
  • Line 13: Your HSA deduction amount (enter on Schedule 1 of Form 1040).

If married with family coverage, allocate limits between spouses.

Part II: HSA Distributions

Report withdrawals here.

  • Line 14a: Total distributions from Form 1099-SA.
  • Line 14b: Rollovers or timely withdrawn excess contributions.
  • Line 15: Qualified medical expenses paid with distributions (e.g., doctor visits, prescriptions, or COVID-19 tests).
  • Line 16: Taxable amount (include on Schedule 1).
  • Lines 17a-17b: 20% additional tax on non-qualified distributions (exceptions for age 65+, death, or disability).

Qualified expenses include unreimbursed medical costs for you, your spouse, or dependents.

Part III: Income and Additional Tax for Failure to Maintain HDHP Coverage

Use this if you used the last-month rule or a qualified funding distribution but didn’t stay eligible.

  • Lines 18-20: Calculate income to include.
  • Line 21: 10% additional tax.

This applies during the “testing period” (up to 12 months after the last month of eligibility).

Recent Changes to IRS Form 8889 for Tax Year 2025

The IRS has updated rules for 2025 to reflect new legislation and notices:

  • Telehealth and Remote Care: HDHPs won’t be disqualified for providing no-deductible telehealth services. Eligible individuals can disregard telehealth coverage (applies to plan years after 2024).
  • Preventive Care Expansions: Includes OTC oral contraceptives, male condoms, expanded breast cancer screening, continuous glucose monitors, and insulin without a diabetes diagnosis.
  • Qualified Medical Expenses: Condoms are now treated as medical care, eligible for HSA reimbursement.
  • HDHP Deductibles: Minimums are $1,650 (self-only) and $3,300 (family); out-of-pocket maxes are $8,300 and $16,600.

These changes make HSAs more flexible for preventive and remote care.

Common Mistakes When Filing Form 8889 and Tips to Avoid Them

  • Overcontributing: Always check prorated limits if eligibility changed mid-year.
  • Misreporting Distributions: Only qualified medical expenses avoid taxes—track receipts.
  • Forgetting Employer Contributions: These reduce your personal limit (from W-2, box 12, code W).
  • Tips: Use IRS Pub. 969 for examples. File electronically for accuracy. Consult a tax professional if you inherited an HSA or failed the testing period.

Where to Get IRS Form 8889 and Instructions?

Download the latest Form 8889 and instructions from the IRS website:

File by April 15, 2026 (or later with extension), even if contributing up to the deadline.

Maximizing Your HSA with Form 8889

Understanding IRS Form 8889 is key to leveraging HSAs for tax savings on healthcare. By reporting accurately, you can deduct contributions, avoid penalties, and ensure tax-free growth. Stay updated with IRS changes, and consider consulting a financial advisor to optimize your strategy. For more on HSAs, explore Pub. 969 or visit IRS.gov.