Thanks Opus 17,
Regarding the "individual" status if an HSA: Before I was disabled and went on medicare, I had the HSA through my employer along with a family HDHP. We always contributed the maximum to reduce our tax liability. I continued to contribute to the HSA, being ignorant to the fact that my medicare made my HSA ineligible. My mistake was assuming my HSA could be used as a family account because we file MFJ, and my wife enrolled in a HDHP through her employer after her COBRA on my family plan ended. I accept that the entire 7900 is subject to income tax, but TTax counted is as income, and also included a 10% penalty for contributing to an ineligible HSA. You can check out my reply to dmertz about the way TTax handled contributions and distributions.
We did open a new HSA for my wife after the first of the year. We have already made contributions to it for the 2019 tax year thinking we had already maxed out the family limit with my HSA. I have already contacted my wife's HSA bank about redirecting this year's contributions to the 2018 tax year since none of last years contributions to my account are valid.
