@k3offline wrote:
Thanks. The balance for 2020 (after excess removal and distributions) is zero.
I do see the screen you mentioned. If I enter 5550 in the box, will Turbotax calculate 6% penalty on the 1550?
Shouldn’t TurboTax see that I already have a distribution of 1550 ( from my 1099-SA that I entered) and ask me to withdraw 5550?
I haven't set up this specific test, but there should be some way that Turbotax captures the ending balance of the account, since it is used on form 8889 to determine if a penalty is required. I would just run the entire program and see what happens. It may be that when you enter that you will only remove $5500, that will trigger a separate penalty interview, where you will be asked to enter the ending balance after removing the excess. (Turbotax's interviews often follow the tax forms and the HSA excess is calculated on form 8889, but the penalty is calculated on form 5329, so there might be two different interview sub-sections. )
