My daughter had a high-deductible health plan for the first 3 months of 2024, then switched to a job without an HDHP. Her HSA was subsequently overfunded by about $1,100 in 2024. My daughter requested to the HSA administrator that the overfunding be removed. That administrator said it could be done, but the money would go to her former employer, and she'd have to arrange with the former employer to get it. But my daughter contacted her former employer, who said they would not send such money (the overfunded amount that would be transferred by the HSA administrator) to my daughter. The former employer said "Your best bet is to keep the (overfunded amount in the HSA) and pay the penalty." My question: Is this actually good advice? It doesn't seem like it, but at this point myself and the daughter are at a loss as to how to proceed. Can you please provide advice in that regard? Thank you.
