Reporting Form 1099-SA Distributions From an Archer MSA in Lacerte

This article will help you report distributions from a Medical Savings Account (MSA) and calculate any taxable amounts in the Individual module of Lacerte.

To enter amounts from a Form 1099-SA related to a MSA:

1. Go to Screen 32.2, Medical Savings Accounts (8853).
2. Scroll down to the MSA Distributions section.
3. Enter the Total MSA distributions received (1099-SA, box 1).
4. Enter any qualified medical expenses in Total unreimbursed qualified medical expenses.

What if the distribution amount exceeds the amount of unreimbursed medical expenses?

• If the amount of the distribution exceeds the amount of unreimbursed qualified medical expenses, the difference is taxable and will flow to Schedule 1 (Form 1040), line 8, Other Income, with MSA in the description field.
• In addition to this, an additional 20% tax will be calculated on Form 8853, Part II, line 9B.
  • Any or all of the amount may be excluded from the 20% tax by making an entry in Amount to exclude from 20% tax (1=exclude all) in Screen 32.2, Medical Savings Accounts (8853).
  • The 20% tax does not apply if the distribution is made after the account holder dies, becomes disabled, or reaches age 65.