Get your taxes done using TurboTax

W-2 Box 12b accurately shows my contribution as $4700 (code W) - good.

Turbo does not detect the overfunding in the W2 section.-  since you haven't entered your HDHP information yet, there is no way that TurboTax can detect excess contributions at this point.

 I follow prompts and enter everything correctly in the HSA section. - good.

Turbo sees the overfund am't & correctly tells me to withdraw the excess before the April deadline. - good.

The amount I owe correctly increases because Turbo has entered this info into form 8889. -  actually, the amount you owe increases because TurboTax added the excess to Other Income on line 8 on Schedule 1 (1040).

"PROBLEM:  

Turbo is not populating form 5329 which is mandated by the IRS."

No, the 5329 is not mandated by the IRS.

You needed to keep reading on the same page (page 😎 in Pub 969:

"You may withdraw some or all of the excess contributions and avoid paying the excise tax on the amount withdrawn if you meet the following conditions.

• You withdraw the excess contributions by the due date, including extensions, of your tax return for the year the contributions were made.

• You withdraw any income earned on the withdrawn contributions and include the earnings in “Other income” on your tax return for the year you withdraw the contributions and earnings."

You did bullet one when you said you would withdraw the excess. I like to call it "cured" the excess. So, no excise tax for you, so no 5329.

Please do not try to add form 5329. You don't need it.

"BONUS QUESTION FOR THE BRAVE:  Advice abounds on the internet saying my employer needs to revise Box 1 of my W2.  But if they do, then Turbo will tax me yet again on my now higher amount."

That's bad advice. Your employer didn't make the mistake (unless they had reason to know that the code W amount would be an excess, and they usually don't). Enter the W-2 exactly as is, and let TurboTax handle adding the excess back to Income on Schedule 1 (1040) and completing your 8889.

Since you have already withdrawn the excess, you are done with your HSA for this year.

NOTE: next year, TurboTax may ask you if you "overfunded" your HA last year. What TurboTax really wants to know is if you carry over any excess. Since you cured the excess this year, answer NO to this question next year.