Hi,
I need to understand what went wrong and how I can correct it. Here is the scenario:
1. For 2022 tax year, TurboTax (TT) determined we (joint return) made a $1900 excess contribution for HSA. I understand this is "pre-tax".
2. TT asked if I was going to withdraw the excess contribution before the 2022 tax filing deadline and I indicated Yes. At this point, I understand that TT must have calculated Taxes on $1900 without penalities as I saw this in the additional income section.
3. I logged into the HSA account provider and withdrew $1900 and I thought it was done.
4. Fast foward to 2023 tax year (now), I see a 1099-SA with a Distribution code of 1.
5. As I do my taxes now for 2023, I think I am getting taxed again for $1900 as TT sees that as a regular distribution and maybe another penalty?
I called the HSA account provider to see if they can reissue a 1099-SA with a distribution code of 2 but they indicated they can't as I did not follow the right process and file some form with them before withdrawing money.
What is the right way to correct this through TT? What options do I have?
Please advise.
