Questions and Answers

The employer may correct the error. At the employer's option, the employer may request that the financial organization return the excess amounts to the employer. If the employer does not recoup the amounts, the employer must include them as gross wages and income on the employee's Form W-2 for the year during which the employer made the contributions. If amounts contributed are less than or equal to the maximum annual amount, the employer may not recoup any amount from the employee's HSA. The IRS has not addressed HSA custodian/trustee reporting in this situation.