If you received a distribution from a Health Savings Account (HSA) and rolled all or part of that money into another HSA, you'll need to report the rollover correctly on your tax return. Even though the distribution appears on Form 1099-SA, a qualified rollover is generally not taxable when reported properly.
Reporting an HSA Rollover in the Tax Program
To report a distribution that was rolled over to another HSA, follow these steps:
- Select Federal.
- Select Deductions and then Select My Forms.
- Choose Adjustments to Income.
- Select Health Savings Account (Form 8889).
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Enter the amount from your Form 1099-SA that was rolled over into another HSA when prompted for:
"Distributions you received in 2026 that you rolled over into another HSA, including any excess contributions (and earnings on those excess contributions) reported on Form 1099-SA that were withdrawn by the due date of your return."
What Is an HSA Rollover?
An HSA rollover occurs when you withdraw funds from one HSA and deposit them into another HSA within 60 days. When completed correctly, the rollover is not taxable and does not count as a new HSA contribution.
Keep in mind that the IRS generally allows only one HSA rollover during a 12-month period. Trustee-to-trustee transfers between HSA providers are treated differently and are not subject to this limitation.
Additional Information
For more details about HSA rollovers and reporting requirements, see:
- IRS Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans
- How do I report my Health Savings Account (HSA) Form 8889?
Reporting the rollover correctly helps ensure your HSA distribution receives the proper tax treatment and keeps your return accurate.