"BTW, TurboTax 2020 comes up with a maximum contribution limit of $4050, not the $4550 I calculated. How did TT comes up with $4050?"
TurboTax came up with this because - contrary to what you were told - the $1,000 "bonus" for 55+ is prorated by the number of months. So you have $7100 / 2 = $3550 + $500 = $4050.
"I do believe I will need to report the gains as "other income" in my 2021 return since the withdrawal will occur in 2021."
No, if any part of the excess was "employer" contributions (i.e., the code W amount in box 12 on your W-2), the TurboTax automatically added it back to Other Income on your 2020 return (look at line 8 on Schedule 1 (1040)).
What you will report in 2021 are the earnings on this excess - you will receive a 1099-SA for this purpose in early 2022 to put on your 2021 return.
"I am assuming the $200 is considered other income and is taxable in 2020, while the $3350 is not taxable since it is after-tax money and I don't have to report it in my 2020 return."
The $200 is actually $700 (because of the pro-rated $1,000 "bonus" above) - but otherwise you are substantially correct.
Note that TurboTax will take care of this automatically. Your entire personal contribution is removed from the return, and enough employer contribution (the $700) is added to Line 8 on Schedule 1 (1040) to make up the difference.
So once you notify your HSA custodian to withdraw the excess of $4,050 (8,100 minus the max contribution of 4,050), then you will be done. NOTE: look for an online form at your HSA custodian's website.
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