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Hi Bill, thank you so much for the quick response.

Here are my answers to your questions.

" we asked HSA to withdrawal and roll over the excess contribution to year 2021" - I don't understand what you mean. Did you ask the HSA custodian to withdraw the excess (in which case, they would have sent you a check for the amount0, or did you allow the excess to carryover to the next year? If the latter case, then you should have reduced your normal 2021 contributions by the amount of the carryover, or you would have another year with excess contributions.

Jerry: Yes, it's the latter case. We front loaded HSA at the beginning of 2021, and when we realize the problem, we have already excess conteibuted to both 2020 and 2021. So we decided to carryover the excess in 2020 to 2021, and sum up, calculate 2021 total excess, and then in Mar 2021, we asked HSA custodian to withdrawal the excess to our banks. But later in 2021, we switched jobs, and the new company contributed additional $1240 (not from our paycheck, but simply employer contribution front load), that caused 2021 excess contribuition again...

"In Mar 2021, we noticed we over-contributed again for year 2021," Did you really notice that you had excess contributions for 2021 in March of 2021?

Jerry: We front loaded HSA (well, majority of the HSA contribution is from employer part, not our part, which contributes on the first pay check in Jan), so when we notice that, it's too late.

"Our W2 does not show our 1980 and 1530 roll over from 2020, so where to type these info? " This should not appear on your W-2; this is a matter between you, the HSA custodian, and the IRS.

Your excess was $2,000 plus $1,550 - the fees charged by the HSA custodian don't reduce the rollover amount (if any).

Jerry: on healthequity.com website, as well as their 5498 form, they actually used 1980 and 1530 as 2021 contribution. But just FYI, since it does not make big difference.

"Turbotax keeps telling us our excess contribution is $3340 (5940+4600-7200), it does not count in the 1980+1530 from rollover." - $3,340 is your excess for tax year 2021. It does not include the excess for tax year 2020. You can withdraw the excess for 2021 (provided that you do it by the due data of April 18, 2022) but you can't withdraw the 2020 excess any longer.

Jerry: For year 2020, we asked HSA to carryover the 3550 excess to 2021, so this 2000+1550 should be counted into 2021? If so, the excess contribution of 2021 should be 3340 + 2000 + 1550 = 6890? (Or 6850 if excluding the $40 fee)

"We have typed our 2 1099-SA forms, but there is no where to show that the 5000 or 4160 distributions offset our excess contribution" - I have no idea what this means.

Jerry: NVM, I will explain at the end.

"Any contribution you personally made (not through your employer): I thought this is where to type the $1980 and $1530 numbers?" - do NOT enter any amounts here that were part of the code W amount on your W-2! This field is ONLY for amounts that you sent directly to your HSA custodian. Any amounts you contributed by means of payroll deduction are called the "employer contribution" - really, it's OK, it works out better for you. The field you refer to is only for contributions you did NOT make through your employer.

Jerry: Ok, i will ignore this one

"Any contribution you personally made but withdrawal before Apr 18, 2022: I thought this is where to type the $3000 and $2610 numbers? But this cell some times do not show up for taxplayer 2 (some times do show up...)" TurboTax is trying to understand which part of the excess that you are withdrawing is from direct contributions, not through your employer. But you have TurboTax thoroughly confused at this point which is why you see the input field at some times and not at others.

Jerry: Ok, I will ignore it for now.

Jerry: So now my questions are:

• From our W2, we contributed 5940+4600=10540, which is 3340 more than the 7200 limit. But since we had the 2020 excess contribution of 3550(=2000+1550) carryover to 2021 (Which shows up in 5498 form as 2021 contribution), should we actually count our excess contribution as 3340 + 3550 = 6890? If so, where to tell Turbotax the 3350?
• On March 2021 we withdraw 5610=3000+2610 excess contribution for year 2021, should this help to reduce the above 6890? If so, where to tell Turbotax?
• Based on the above 2 numbers, looks like we will have to withdraw another 6890-5610=1280 as excess contribution to our bank accounts, right?
• Do I need to pay income tax on the withdrawal of excess contribution? (The 3000 + 2610 on Mar 2021, plus the 1280 that I will withdraw soon, equals to 6890), if so, where should I tell Turbotax, or which form in Turbotax tax filing should I see this number?

@BillM223 Thank you, and please see my above answers.