For employment tax purposes, when contributions are made by an S corporation to an HSA of a 2-percent shareholder-employee, the 2-percent shareholder-employee is treated as an employee subject to Federal Insurance Contributions Act (FICA) tax and not as an individual subject to Self-Employment Contributions Act (SECA) …
Can my employer contribute to my personal HSA?
Generally, contributions made by an employer to the health savings account (HSA) of an eligible employee are excludable from an employee’s income and are not subject to federal income tax, Social Security or Medicare taxes. An employee’s HSA may be funded by contributions from the employer, from the employee or both.
Can a greater than 2 percent shareholder contribute to an HSA?
Greater than 2 percent shareholders of an S Corporation have different requirements when it comes to an HSA. Any contribution made by the employer to the HSA of a greater than 2 percent shareholder must be included as taxable income on the shareholder’s W-2, but are not subject to employment taxes.
When does s Corp make HSA contributions on behalf of employees?
This article explores the tax issues when an S Corp makes HSA contributions on behalf of its more than 2 percent shareholder-employee and its non-shareholder employees. Payments on Behalf of Employees. When your S Corp makes a payment to an HSA account on behalf of its employees, the employees own their HSA accounts.
Where do I put my HSA contribution on my W-2?
The corporation’s HSA contribution is a tax-free fringe benefit to the employee that is reported on the employee’s Form W-2 in box 12, using the code “W.” While the employee receives a tax free fringe benefit, your S Corp deducts the contributions to the HSA as an employee benefit program expense.
Can a qualifying employee contribute to an HSA?
With an HSA, both the qualifying employee and the employer can contribute to the employee’s HSA. HSAs have many appealing elements – three of those attributes are:
