Instructions For Form 8853 - 2016 (Page 5 of 8) in pdf

Additional 50% Tax Worksheet—Line 13b

Keep for Your Records

Enter the total distributions included on Form 8853, line 12, that don't meet either of the exceptions to the additional 50% tax . . . . . . . . . . . . . .

Did you have a Medicare Advantage MSA on December 31, 2015?

No.

Enter one-half of line 1 on Form 8853, line 13b

STOP

Yes. Enter the value of your Medicare Advantage MSA on December 31, 2015

. . . . . . . . . . . . . . . . . . . .

Enter the amount of the annual deductible for your HDHP policy on January 1,

2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Multiply line 3 by 60% (0.60) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Subtract line 4 from line 2. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Subtract line 5 from line 1. If zero or less, enter -0- . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Enter one-half of line 6 here and on Form 8853, line 13b

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

distribution from an Archer MSA that is included

either spouse checked the box on line 13a of

SSN in the spaces provided at the top of the

in income. Don't check the box on line 9a

the statement Form 8853, check the box on the

form. Skip Section A.

because your spouse (the account holder)

controlling Form 8853. Attach the two statement

On line 10, enter the fair market value of the

didn't meet the age exception for the

Forms 8853 to your paper tax return after the

Medicare Advantage MSA as of the date of

distribution. Enter 20% of the amount from

controlling Form 8853.

death.

line 8 on line 9b.

On line 11, for a beneficiary other than the

If you (or your spouse, if filing jointly)

estate, enter qualified medical expenses

received distributions from a

Example 2. Both you and your spouse

incurred by the account holder before the date

Medicare Advantage MSA in 2016,

received distributions from your Archer MSAs in

CAUTION

of death that you paid within 1 year after the

you must file Form 8853 with a Form 1040 even

2016 that are included in income. You were age

date of death.

if you have no taxable income or any other

65 at the time you received the distributions and

Complete the rest of Section B.

reason for filing Form 1040.

your spouse was age 63 when he or she

received the distributions. Check the box on

If the account holder's estate is the

Medicare Advantage MSA

line 9a because the additional 20% tax doesn't

beneficiary, the value of the Medicare

apply to the distributions you received (because

Advantage MSA as of the date of death is

A Medicare Advantage MSA is an Archer MSA

you met the age exception). However, the

included in the account holder's final income tax

designated as a Medicare Advantage MSA to

additional 20% tax does apply to your spouse's

return.

be used solely to pay the qualified medical

distributions. Enter on line 9b only 20% of the

expenses of the account holder. To be eligible

The distribution isn't subject to the additional

amount of your spouse's distributions included

for a Medicare Advantage MSA, you must be

50% tax. The beneficiary should report any

in line 8.

enrolled in Medicare and have an HDHP that

earnings on the account after the date of death

meets the Medicare guidelines. Contributions to

Example 3. You turned age 65 in 2016.

as income on the beneficiary's tax return.

the account can be made only by Medicare.

You received distributions that are included in

The contributions and any earnings, while in the

Note. If, during the tax year, you are the

income both before and after you turned age

account, aren't taxable to the account holder. A

beneficiary of two or more Medicare Advantage

65. Check the box on line 9a because the

distribution used exclusively to pay for the

MSAs or you are a beneficiary of a Medicare

additional 20% tax doesn't apply to the

qualified medical expenses of the account

Advantage MSA and you have your own

distributions made after the date you turned age

holder isn't taxable. Distributions that aren't

Medicare Advantage MSA, you must complete

65. However, the additional 20% tax does apply

used for qualified medical expenses of the

a separate Form 8853 for each MSA. Enter

to the distributions made on or before the date

account holder are included in income and also

“statement” at the top of each Form 8853 and

you turned age 65. Enter on line 9b, 20% of the

may be subject to a penalty.

complete the form as instructed. Next, complete

amount of these distributions included in line 8.

a controlling Form 8853, combining the

Death of Account Holder

Section B—Medicare

amounts shown on each of the statement

If the account holder's surviving spouse is the

Forms 8853. Attach the statements to your

Advantage MSA

designated beneficiary, the Medicare

paper tax return after the controlling Form 8853.

Advantage MSA is treated as a regular Archer

Distributions

Line 10

MSA (not a Medicare Advantage MSA) of the

Complete Section B if you (or your spouse, if

surviving spouse for distribution purposes.

Enter the total distributions you received in

filing jointly) received distributions from a

Follow the instructions in Section A for

Death of

2016 from all Medicare Advantage MSAs.

Medicare Advantage MSA in 2016. If both you

Account

Holder, earlier.

These amounts should be shown in box 1 of

and your spouse received distributions,

Form 1099-SA. This amount shouldn't include

If the designated beneficiary isn't the

complete a separate Form 8853, Section B, for

any erroneous contributions made by Medicare

account holder's surviving spouse, or there is

each spouse. Enter “statement” across the top

(or any earnings on the erroneous

no designated beneficiary, the account ceases

of each Form 8853, fill in the name and SSN,

contributions) or any amounts from a

to be an MSA as of the date of death. The

and complete Section B. Next, add lines 10, 11,

trustee-to-trustee transfer from one Medicare

beneficiary completes Form 8853 as follows.

12, and 13b from the two statement Forms

Advantage MSA to another Medicare

Enter “Death of Medicare Advantage MSA

8853 and enter those totals on the respective

Advantage MSA of the same account holder.

account holder” across the top of Form 8853.

lines of the controlling Form 8853 (the

Enter the name(s) shown on the

combined Form 8853 for both spouses). If

beneficiary's tax return and the beneficiary's

Instructions for Form 8853 (2016)

-5-

Instructions For Form 8853 - 2016 Page 5

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