There are 2 types of questions you are asking: 1) What is the right thing to do taxwise and 2) How to enter the information in turbotax. DaveF1006 correctly answers topic #1. Topic #2 is challenging. I havent been able to figure how to do this in turbotax because the way that turbotax calculates the excess contributions may not match your $2900. Then it doesnt allow you to enter $2900 as the amount of excess contributions removed. If you are lucky, and the $2900 matches, then just follow the interview questions under HSA.
