Thank you, so as I understand it, this is what I should see:
2023 Return - $3,850 in other income and 6% penalty (already amended and paid)
2024 Return - $248 earnings in other income, and no 6% penalty because all 2023 activity was withdrawn before 12/31/2024
I understand that I will have to pay the 20% penalty on the full $4,098. Can this be avoided (fully or partially) if I indicate that I used the distribution for medical expenses? As I understand it, even though I was ineligible for the HSA in the first place, I can still use these funds for medical expenses and avoid the 20%?
