No I did not mean to imply that. What the 1099R has is box 1 with the total distribution and box 7 is G with X for IRA. That is all that is filled in on the formal 1099R from the custodian. What I am saying is that I am entering the HSA funding amount on the 1099R worksheet from Turbotax, it's below the formal boxes on the Win desktop form, along with several other fields and boxes that can be checked. The distribution was a direct rollover from an IRA to an HSA, this is a once a lifetime allowance so is probably pretty rare for TTax to handle. The IRA box on the 1099R is checked since this was an IRA distribution. The problems I have are with TurboTax forms, not the IRS forms. The 1099R summary and the 1099R worksheet are Turbotax forms and are causing the problem. The 1099R worksheet has a field for HSA funding that I have to fill in to get the rollover amount to move to the 1099R summary which then populates form 8889 to show the funding contribution correctly. So the 1099R worksheet moves two numbers to the 1099R summary, both the line 1 total distribution and the HSA funding distribution field, a TurboTax only field. When this happens then the distribution is subtracted twice from the total 1099R distributions from all 1099Rs. This understates taxable income for the amount of the HSA funding distribution direct rollover.
