What Is the Box 12 HSA Contributions Code?

The codes in Box 12 of your Form W-2 provide additional financial information separate from your main wages. This article clarifies what the “Code W” designation represents for your Health Savings Account (HSA) and the necessary actions for your tax filing.

Defining Box 12 Code W

The amount next to Code W in Box 12 of your W-2 represents the total contributions made to your Health Savings Account through your employer’s payroll system. This figure is a combined total, including both the pre-tax funds you contributed from your paycheck and any contributions your employer made.

This combined contribution amount has already been excluded from your taxable income for the year. Consequently, the wages reported in Box 1 of your W-2 have already been reduced by this HSA contribution total. This means you have already received the tax benefit for these contributions and should not deduct this amount again.

The reporting in Box 12 is an informational item for you and the IRS. It confirms the amount of money directed into your HSA with pre-tax advantages through your employer’s plan. Understanding that this is a consolidated figure is important for correctly reporting your HSA activity.

Reporting HSA Contributions on Your Tax Return

To properly account for your HSA contributions, you must use IRS Form 8889, Health Savings Accounts (HSAs). This form is a required attachment to your Form 1040. The total amount reported under Code W in your W-2 is entered on Line 9 of Form 8889.

Some individuals make additional HSA contributions outside of their employer’s payroll system using after-tax money. These personal contributions are reported on Line 2 of Form 8889.

The form then uses these figures to calculate your total contributions and determine if you are eligible for a deduction for after-tax amounts you paid. The information from Form 8889 flows to your main tax return, ensuring all contributions are accounted for correctly and preventing double-deduction.

Verifying Your Contribution Total

It is a good practice to verify that the amount reported in Box 12 with Code W is accurate. You can do this by comparing the figure on your W-2 to the year-to-date HSA contribution totals on your final pay stub of the year. The two numbers should match.

For the 2024 tax year, the annual contribution limit for an individual with self-only health coverage is $4,150, and for family coverage, it is $8,300. Individuals age 55 or older are permitted an additional catch-up contribution of $1,000. Your total contributions from all sources cannot exceed these federal limits.

You will also receive Form 5498-SA from your HSA custodian. This form is sent later in the tax season, usually by May, and it reports the total contributions made to your account for the year. You can use Form 5498-SA as a final cross-reference to confirm the accuracy of your W-2 and your own records.