HR shares important 2021 benefit deductions, tax information plus Dec. 31 pay details

The first biweekly pay date for 2021 is today (Jan. 13). Benefit deductions for this payroll are a combination of late December 2020 and early January 2021, and insurance premiums will be prorated as follows:

• Premium deductions for 2020 (Dec. 21 through Dec. 31), which will be reflected under the 2020 plan names: Purdue Health Plan, Purdue Health Plan Plus HSA or Purdue Health Plan Plus HSA 2.
• Premium deductions for 2021 (Jan. 1 through Jan. 3), which will be reflected under the 2021 plan names: Premier CDHP, Standard CDHP or Limited CDHP.

Additionally, health savings account (HSA) and flexible spending account (FSA) contributions will show as:

• HSA employee contributions will be normal amount per pay elected for 2021 by employee.
• HSA employer contributions will be fully front-loaded today for 2021; no other employer contributions will be deposited in 2021 unless the employee earns Healthy Boiler wellness incentive funds.
• FSA will be normal amount per pay elected for 2021 by employee.

The second biweekly pay period in January (ending Jan. 27) will reflect the ongoing 2021 deduction amounts.

For employees paid on a monthly basis, the Jan. 31 pay date will be the first full pay in 2021 and the first pay with all 2021 deductions reflected:

• All normal 2021 premium deductions.
• HSA employee contributions will be the amount elected for 2021 by the employee.
• HSA employer contributions will be fully front-loaded for 2021.
• FSA contributions will be the amount elected for 2021 by the employee. 

Employees are asked to review their pay statements regularly in the Employee Launchpad via the OneCampus Portal.

HSA, DCFSA deposits now available on first business day after payday

As a reminder, due to a process change by HSA Bank, the administrator of Purdue’s funding accounts, employees will have access to their health savings account (HSA) and dependent care flexible spending account (DCFSA) deposits on the first business day after payday.

2020 tax year impact on Dec. 31 pay date

The first business day after Dec. 31, 2020, was Jan. 4, 2021, so employee funds for HSAs are shown as being contributed in 2021; however, these amounts applied to the 2020 tax year accounts and therefore to the 2020 IRS contribution limits (not the 2021 limits). This is reflected in the member portal when looking at the tax year to which the contribution applied. 

Log into www.hsabank.com, click Cash Account under the Health Savings Account header, scroll to Processed Transactions and expand the row next to the contribution date of 1/4/21 by clicking the “+” (plus sign).  In tax year 2021, employees will see the amount reflected by “Contribution Amount in Tax Year.” For tax year 2020, employees will see the amount next to “Contributions Applied from Future Year.”

Questions can be directed to HSA Bank Customer Service at 800-357-6246.

Contributions to prior tax year HSA

HSA contribution deadlines are based on tax year, meaning accountholders typically have until April 15 to make contributions to the prior tax year. Any future contributions made in 2021 for the prior tax year 2020 would need to adhere to the IRS contribution limits for 2020. Those who have not reached the 2020 maximum contribution limit and would like to contribute to their 2020 account, may do so via the one of the following options:

• Via the member portal at hsabank.com – marking 2020 for the tax year (employees must have linked their bank account).
• By completing the HSA Contribution Form – noting the contribution is for the prior year 2020 – and returning it along with a check to HSA Bank.

HSA tax year summary

Contribution deadlines are based on tax year, meaning those with HSAs typically have until April 15 to make contributions to the prior tax year.  Any future contributions made in 2021 for the prior tax year 2020 would need to adhere to the IRS contribution limits for 2020.  Those who have not reached the 2020 maximum contribution limit and would like to contribute to their 2020 account, should complete the HSA Contribution Form.

Tax form 1099-SA, which reports funds distributed (withdrawn/spent) in 2020, will be posted to their member portal at www.hsabank.com by the end of January.  Log in, click Accounts, then Statements and the form will be under HSA Tax Statements. Employees will receive a copy by mail only if they opted into paper mailings as a preference with HSA Bank. Employees are required to report the information on this form when filing their taxes. 

Tax form 5498-SA, which reports the total contribution amount made to their 2020 HSA along with their HSA balance as of the end of December, will not be posted to the member portal until May 2021 (due to the tax filing deadline to contribute to the prior tax year). The information on this form is only for employee records and is not required when filing taxes.

More information can be found on the Purdue HSA Medical Plans webpage and on HSA Bank’s HSA Tax Time 101 website.  Account-specific questions may be directed to HSA Bank’s customer service at 800-357-6246.

2020 Form 1095-C (Employer-Provided Health Insurance Offer and Coverage), which reports whether the employee and their dependents were offered and enrolled in medical coverage in each month of 2020, will be mailed by March 2. This form is not required when filing taxes.

Questions

Questions can be directed to Human Resources at 765-494-2222, toll-free at 877-725-0222 or via email at hr@purdue.edu.