401k transfer directly to an HSA allowed?

Can a transfer from a 401k go directly into an HSA without a taxable event? Or does it have to be transferred to an IRA first, then to the HSA?



Must go to IRA first since a qualified HSA funding distribution can only be made from an IRA account. Remember that this transfer is a one time opportunity and replaces the amount you could otherwise make to your HSA. You will need to report this on Form 8889. Will require some prompt action to complete the two step process by year end.



Once the funds are rolled out from the 401k into the IRA, does the IRA have to be recharacterized in a particular way as an HSA qualified IRA?  (Let me know where I can find the best information on HSA’s)  Is this one-time transfer of funds for 2012 only?  



  • No particular IRA characterization is required. The one time transfer can be made in any year. Pub 969 addresses these funding distributions on p 6:

http://www.irs.gov/pub/irs-pdf/p969.pdf



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