Actually, when the distribution code is '2', the amount in box 1 for the distribution is ignored by TurboTax. Why? Because the excess contribution was already automatically added to Other Income in the year that the excess was made (i.e., the first year, not in subsequent years). We don't need the box 1 amount.
When the distribution code is '2', we will look only in box 2 for earnings, which we will add to Other Income for the year it is reported.
I assumed that you had received a 1099-SA for 2019, because I had assumed that you made payments out of your HSA every year for qualified medical expenses. When you enter the 1099-SA, that is when you see these questions about qualified medical expenses.
If you did not receive a 1099-SA early this year for 1099-SA, either you made no such distributions in 2019, or the custodian failed to get it to you (you can always go to their website and get it yourself).
In any case, if you should not have received the 1099-SA this year, you can force it next year by calling the custodian right now and asking for a distribution equal to the amount of the long-running carryover. Yes, it will come with distribution code of '1' because it is a normal distribution from their point of view. But you will be able to tell TurboTax that this amount was not for medical expenses during the 1099-SA interview, and this will cut off the long-running carryover.
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