When you file the withdrawal of excess contributions request with the HSA custodian, the HSA custodian will send you a check for that amount. Since it will be added to your Other Income when you go through the HSA interview and tell TurboTax that you never had HDHP coverage, you will not only have the money, but you will have paid tax on it, too.
So if your employer removes the money from your paycheck, you will be left short, because they will take the $2,500 but leave you paying tax on that.
So tell your employer that you are OK. Please do not take any money out of my paychecks. The $2,500 will be added to my income and I will pay tax on it, and everything will be good. This also means that they don't need to make a corrected W-2. You need that code W in box 12 to trigger what's going to happen in the HSA interview.
Steps 4, 5, and 6 are fine.
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