Instructions For Form 8889 - Health Savings Accounts - 2011


Department of the Treasury
Internal Revenue Service
Instructions for Form 8889
Health Savings Accounts (HSAs)
instructions for information on medical
Section references are to the Internal
expenses of dependents not claimed
Revenue Code unless otherwise noted.
on your return.) You can receive
General Instructions
Eligible Individual
distributions from an HSA even if you
are not currently eligible to have
To be eligible to have contributions
contributions made to the HSA.
What’s New
made to your HSA, you must be
However, any part of a distribution not
covered under a high deductible health
The IRS has created a page on
used to pay qualified medical expenses
plan (HDHP) and have no other health for information about Form
is includible in gross income and is
coverage except permitted coverage. If
8889 and its instructions, at
subject to an additional 20% tax unless
you are an eligible individual, anyone
gov/form8889. Information about any
an exception applies.
can contribute to your HSA. However,
future developments affecting Form
you cannot be enrolled in Medicare or
8889 (such as legislation enacted after
Qualified Medical Expenses
be claimed as a dependent on another
we release it) will be posted on that
person’s tax return. You must be, or be
Generally, qualified medical expenses
considered, an eligible individual on the
for HSA purposes are unreimbursed
first day of a month to take an HSA
medical expenses that could otherwise
Purpose of Form
deduction for that month (see
be deducted on Schedule A (Form
Use Form 8889 to:
Last-month rule next).
1040). See the Instructions for
Schedule A and Pub. 502, Medical and
Last-month rule. If you are an eligible
Dental Expenses. Expenses incurred
Report health savings account (HSA)
individual on the first day of the last
before you establish your HSA are not
contributions (including those made on
month of your tax year (December 1 for
qualified medical expenses. If, under
your behalf and employer
most taxpayers), you are considered to
the last-month rule, you are considered
be an eligible individual for the entire
to be an eligible individual for the entire
Figure your HSA deduction,
year for determining the contribution
Testing period. You must remain
Report distributions from HSAs, and
amount, only those expenses incurred
an eligible individual during the testing
after you actually establish your HSA
Figure amounts you must include in
period. The testing period begins with
are qualified medical expenses.
income and additional tax you may owe
the last month of your tax year and
if you fail to be an eligible individual.
ends on the last day of the 12th month
Note. Non-prescription medicines
following that month (for example,
(other than insulin) purchased in tax
Additional information. See Pub.
December 1, 2011 – December 31,
years beginning after December 31,
969, Health Savings Accounts and
2012). If you fail to remain an eligible
2010, are not considered qualified
Other Tax-Favored Health Plans, for
individual during this period, other than
medical expenses.
more details on HSAs.
because of death or becoming
disabled, you will have to include in
You cannot treat insurance
income the total contributions made
premiums as qualified medical
Who Must File
that would not have been made except
expenses unless the premiums are for:
You must file Form 8889 if any of the
for the last-month rule. You include this
1. Long-term care (LTC) insurance,
following applies.
amount in income in the year in which
2. Health care continuation
you fail to be an eligible individual. This
You (or someone on your behalf,
coverage (such as coverage under
amount is also subject to a 10%
including your employer) made
additional tax. (See Part III.)
contributions for 2011 to your HSA.
3. Health care coverage while
Account Beneficiary
You received HSA distributions in
receiving unemployment compensation
under federal or state law, or
The account beneficiary is the
You must include certain amounts in
4. Medicare and other health care
individual on whose behalf the HSA
income because you failed to be an
coverage if you were 65 or older (other
was established.
eligible individual during the testing
than premiums for a Medicare
supplemental policy, such as Medigap).
Generally, an HSA is a health savings
You acquired an interest in an HSA
account set up exclusively for paying
because of the death of the account
Coverage under (2) and (3) can
the qualified medical expenses of the
beneficiary. See Death of Account
be for your spouse or a
account beneficiary or the account
Beneficiary on page 2.
dependent meeting the
beneficiary’s spouse or dependents.
requirement. For (4), if you, the account
Distributions From an HSA
beneficiary, are under age 65, Medicare
If you (or your spouse, if filing
premiums for your spouse or
jointly) received HSA
Distributions from an HSA used
dependents (who are age 65 or older)
distributions in 2011, you must
exclusively to pay qualified medical
generally are not qualified medical
file Form 8889 with a Form 1040 even if
expenses of the account beneficiary,
you have no taxable income or any
spouse, or dependents are excludable
other reason for filing Form 1040.
from gross income. (See the line 15
Nov 01, 2011
Cat. No. 37971Y


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