Discussion:W-2 Reporting Code W - Employer HSA Contribution

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Discussion Forum Index --> Tax Questions --> W-2 Reporting Code W - Employer HSA Contribution

JDACPA (talk|edits) said:

9 April 2006
Have client who has W-2. Box 12b shows code "W" - "Employer contributions to HSA". I know not reported as income for Fed purposes, but California has not conformed to Fed law on HSA. Anyone know the proper tax treatment for California purposes? Again, this is not an employee but an employer contribution.

Riley2 (talk|edits) said:

9 April 2006
I am sure that every California employee who participates in an HSA is adding this Code W amount go California taxable income. This also means that the employee's medical expenses will be higher for California purposes.

Scolby22 (talk|edits) said:

7 April 2008
For the second time in about a week I have come across W-2's with employer contributions to an HSA coded with a W in Box 12 that are not deducted pretax. The instructions for the W-2 state that employer contributions (including employee contributions through a cafeteria plan) are not subject to withholding and fica only if the employer reasonably believes that the contribution will be excludable from the employee's income. If it not reasonable to believe that the contribution is excludable then the employer contribution is subject to withholding and fica. It goes on to say that an employee's contribution (unless made through a cafeteria plan) is includable in income as wages subject to withholding and fica and that the employee should deduct the amount on their 1040.

I had been assuming that any employer contributions coded to W in box 12 were being deducted on a pretax basis but that doesn't always seem to be the case. Unless you have a detailed W-2 showing all of the deductions and additions to gross wages there is no way to know whether the amount coded to W in Box 12 has been taken pretax or not. Has anyone else come across this problem?

MsTwizz (talk|edits) said:

15 April 2008
If I am making employee pre-tax contributions to my HSA, why do I not see them deducted off of my gross income on my W-2? Shouldn't they be?

Thanks,

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