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Daily Archives: April 16, 2025

Form 5498-SA

Posted on April 16, 2025 - 12:34 pm by

What is Form 5498-SA?

Form 5498-SA is an IRS form used to report contributions to a Health Savings Account (HSA), Archer Medical Savings Account (Archer MSA), or Medicare Advantage MSA (MA MSA) over a tax year.

 

Explaining HSA, Archer MSA, and MA MSA

 

  • Health Savings Accounts (HSA)

HSAs are tax-advantaged savings accounts designed for taxpayers with high-deductible health plans. It allows for tax-deductible contributions, growth, and withdrawals for qualified medical expenses. Accurate reporting is crucial to avoid a 6% excise tax on excess contributions.

 

  • Archer Medical Savings Accounts (Archer MSA)

Archer MSAs is designed for self-employed individuals and small businesses with HDHPs. The contribution limits are based on a percentage of the HDHP deductible which are 65% for self-only coverage and 75% for family coverage.

 

  • Medicare Advantage MSAs (MA MSA)

Medicare Advantage MSAs are a type of Medicare Advantage plan that combines a high-deductible Medicare health plan with a tax-free medical savings account for healthcare expenses. It is funded only by Medicare and has no individual contributions.

 

Who files Form 5498-SA?

A trustee or a custodian who maintains HSA, Archer MSA, or MA MSA will be required to file Form 5498-SA. Individuals who made contributions to these accounts will be the recipients.

 

Filing Form 5498-SA

A separate form is required for each type of plan, whether it is an HSA, Archer MSA, or Medicare Advantage MSA.

 

Box 1 – Employee or Self-Employed Person’s Archer MSA Contributions

Regular contributions to the Archer MSA, including any excess contributions, by an employee or a self-employed person.

 

Box 2- Total Contributions Made

Total HSA or Archer MSA contributions made in 2025, including qualified HSA funding distributions.

 

Box 3- HSA or Archer MSA Contributions

Total HSA or Archer MSA contributions made in 2026 for 2025.

 

Box 4. Rollover Contributions

Rollover contributions to the HSA or Archer MSA received during 2025.

 

Box 5. Fair Market Value of HSA, Archer MSA, or MA MSA

Fair Market Value of the account on December 31, 2025.

 

Box 6. Checkbox

Indicate if the account is an HSA, Archer MSA, or MA MSA.

Form 5498

Posted on April 16, 2025 - 12:26 pm by

What is Form 5498?

Form 5498 (IRA Contribution Information) is an IRS form that is used for reporting contributions made to an individual retirement agreement (IRA), rollovers, and distributions for the previous tax year.

 

What is reported on Form 5498?

Form 5498 reports the following-

  • Contributions to Traditional IRAs, Roth IRAs, SEP IRAs, SIMPLE IRAs, and Deemed IRAs.
  • The total amount converted when an IRA is converted to a Roth IRA.
  • Contributions to a Kay Bailey Hutchison Spousal IRA under section 219(c).

 

Who files Form 5498?

Form 5498 is filed by financial institutions or trustees who manage IRA contributions. The form is sent to both IRS and taxpayer. However, no action is required from the taxpayer. The form is only used for recordkeeping and to verify IRA contributions and rollovers.

 

Filing Form 5498

The IRS uses Form 5498 to track retirement savings and ensure compliance. Here is a breakdown of each box on Form 5498 and what should be reported.

 

Box 1 – IRA Contributions

Contributions to a traditional IRA including gross contributions, amounts allocated to life insurance costs, and any excess contributions.

 

Box 2 – Rollover Contributions

Rollover contributions received in an IRA including rollovers between IRAs, from qualified plans like 401(k)s, and military death gratuities or SGLI payments.

 

Box 3 – Roth IRA Conversion Amount

The total amount converted from a traditional, SEP, or SIMPLE IRA to a Roth IRA.

 

Box 4 – Recharacterized Contributions

Any amounts, plus earnings, that were recharacterized from one type of IRA to another.

 

Box 5 – FMV of Account

The fair market value (FMV) of the IRA account.

 

Box 6 – Life Insurance Cost Included in Box 1

Contributions in box 1 that were allocated to the cost of life insurance.

 

Box 7 – Checkboxes

Indicate whether the account is a traditional IRA, SEP IRA, SIMPLE IRA, Roth IRA, Roth SEP IRA, or Roth SIMPLE IRA.

 

Box 8, 9, 10 – SEP Contributions, SIMPLE Contributions, Roth IRA Contributions

Employer contributions to a SEP IRA, SIMPLE IRA, and Roth IRA contributions.

 

Box 11, 12a, 12b – RMD Contributions

Required minimum distribution (RMD) amount, date, and if it’s applicable for the following tax year.

 

Box 13a, 13b – Postponed/Late Contributions, Year, Code

Contributions made in a prior year, including late rollovers. Plus, tax year of postponed contribution and appropriate IRS code.

 

Box 14a, 14b – Repayments, Code

Repayments and correct repayment code as applicable.

 

Box 15a, 15b – FMV of Certain Specified Assets, Code(s)

Fair market value of specific IRA investments and up to two codes representing the types of assets.

Fillable W-9 Form

Posted on April 16, 2025 - 12:20 pm by

What is W-9Form?

W-9 Form (Request for Taxpayer Identification Number and Certification) is an IRS form used by businesses to verify the Taxpayer Identification Number (TIN) of individuals and entities they pay for services who are not full-time employees.

The purpose of the W-9 is to allow the business to report how much they paid to an independent contractor, consultant, or another type of self-employed individual the IRS using forms like the 1099-NEC.

If the recipient of payments does not provide a valid TIN on the W-9, the business may be legally required to withhold 24% of future payments as backup withholding and send it to the IRS.

 

Who files Form W-9?

W-9forms are filled by self-employed workers, like independent contractors, vendors, freelancers, and consultants who provide services to companies and have been paid $600 or more in a tax year.

 

Filing Form W-9

Line 1: Legal name

The legal name must match the Social Security Number (SSN) or Employer Identification Number (EIN).

 

Line 2: Business Name or Disregarded Entity Name

If the business operates under a different name (like a DBA, trade name, or disregarded entity), enter that name here. Otherwise, leave it blank.

 

Line 3a & 3b: Federal Tax Classification

Check the box that corresponds to tax classification.

  • Individual/Sole Proprietor or Single-Member LLC
  • C Corporation
  • S Corporation
  • Partnership
  • Trust/Estate
  • Limited Liability Company (LLC)– If selected, specify whether your LLC is taxed as a partnership, C-corp, or S-corp.

 

Line 4: Exemptions (if applicable)

If you are exempt from backup withholding or FATCA reporting, enter the correct exemption code from the IRS instructions.

 

Line 5 & 6: Address

Provide full mailing address (number, street, and apartment or suite number), city, state, and ZIP code

 

Part I: Taxpayer Identification Number (TIN)

If you are an individual or sole proprietor, enter your Social Security Number (SSN). If you are a business entity, enter your Employer Identification Number (EIN).

 

Part II: Certification

Sign and date the form to certify:

  • You’re a U.S. person (or resident alien)
  • The TIN you provided is correct
  • You’re not subject to backup withholding (unless indicated otherwise)

Social Security Administration(SSA)

Posted on April 16, 2025 - 12:04 pm by

What is Social Security Administration (SSA)?

The Social Security Administration (SSA) is an agency that is responsible for overseeing and running the Social Security program in the U.S. Established in 1935, the agency manages and oversees the distribution of retirement, spousal, disability, and survivor benefits to eligible people.

The agency is also responsible for issuing Social Security numbers and cards, enrolling people in Medicare, and managing the SSI program.

 

Programs provided by the SSA

The agency maintains multiple programs that are designed to help U.S. citizens get financial assistance if and when required.

 

Retirement Benefits

The retirement benefits offered by SSA offer monthly income to people after their retirement or after their work hours have been reduced. These payments are based on lifetime earnings, meaning the more a person earns and contributes over the course of their working years, the higher the benefit will be. A person becomes eligible for retirement benefits at age 62, but full retirement benefits starts after age 67.

 

Disability Benefits

People who have a qualifying disability or blindness that stops them from working are eligible for Social Security Disability Insurance (SSDI). This monthly payment is offered to people who have a disability or condition that limits their ability to work for at least a year or they must have worked at least five out of the last ten years and paid into Social Security. They also must earn less than $1,620 per month or $2,700 if legally blind.

 

Survivor Benefits

Certain family members of workers who paid into Social Security and have since died can get financial support through the survivor benefits. In order to be eligible, the surviving spouse must have been married to the dead for at least nine months and be at least 60 years old (or 50 if disabled). Even ex-spouses can qualify if the marriage lasted at least 10 years. If the deceased’s children are unmarried and under the age of 18, or up to the age of 19 if they are still enrolled in school, they may also be eligible for benefits.

 

Family Benefits

Family Benefits are payments made to certain family members of people who are eligible for retirement or disability benefits. If a spouse is 62 or older, or if they are caring for a child under 16 or one with a disability, they may be eligible. Ex-spouses are also eligible if the marriage lasted at least 10 years. Unmarried children under the age of 18 (or up to 19 if still in full-time K–12 education), or at any age if they have a disability that began before age 22 are also eligible.

 

Supplemental Security Income (SSI)

Supplemental Security Income (SSI) is a program administered by the SSA that provides financial assistance to individuals who have limited income and resources, are either age 65 or older, blind, or have a qualifying disability, and earn less than $2,000 ($3,000 for couples).

 

Medicare Benefits

The Social Security Administration administers Medicare benefits for people aged 65 or older, individuals with certain disabilities, or those with end-stage renal disease (ESRD).