Well, now I am confused. How much did your employer actually contribute to your HSA? 6,729? 7,200? 7,549.28? The code W amount suggests that they contributed only 6,729, but now I am not sure what they actually did. So please tell me, and don't simplify things for me.
"In order to let the HSA custodian's record match it, I requested them to return $800 as the return of excess contribution " - an HSA is not just a savings account that you can withdraw money from willy-nilly. You should not withdraw money as an "excess" contribution unless it really is an excess contribution. I can't tell but it seems like your excess was only 329.48, but since I don't know how much your employer actually sent to the HSA, I can't tell.
"Unfortunately, some of your excess contribution is caused by a prior year excess contribution. " - So, did you have an excess contribution in 2020? Did you withdraw it? I am afraid that you have us (me and TurboTax) so confused that we don't know where to go.
So please do the following:
1. Tell me how much your employer actually sent to the HSA.
2. Tell me how much (if anything) the employer withdraw from the HSA (they can within limits).
3. Tell me how much (and when) you withdraw money from the HSA (and why).
4. Tell me how you answered the question "Did you overfund your HSA in 2020?"
5. Also please delete all HSA data from your return by doing the following (so we can start over):
1. make a copy of your W-2(s) (if you don't have the paper copies)
2. delete your W-2(s) (use the garbage can icon next to the W-2(s) on the Income screen)
*** Desktop***
3. go to View (at the top), choose Forms, and select the desired form (see below). Note the Delete Form button at the bottom of the screen.
*** Online ***
3. go to Tax Tools (on the left), and navigate to Tools->Delete a form
4. delete form(s) 1099-SA (if one), 8889-T, and 8889-S (if one)
5. go back and re-add your W-2(s), preferably adding them manually
6. go back and redo the entire HSA interview.
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