BillM223
Expert Alumni

Deductions & credits

Ah, a small correction - you won't see much about this excess withdrawal on your 2022 return...except the 1099-SA that you will receive in early 2023 return, so that you can report the earnings on the excess and pay tax on them in 2022. This 1099-SA will have a distribution code of "2" to tell TurboTax how to handle it.

 

This means that the excess withdrawn should not appear on line 14b on your 2021 return, because line 14a is "Total distributions you received in 2021 from all HSAs" and line 14b is "Distributions included on line 14a that you rolled over to another HSA. Also include any excess contributions (and the earnings on those excess contributions) included on line 14a that were withdrawn by the due date of your return."

 

The excess withdrawal did not happen in tax year 2021, so the amounts should not appear on your 2021 tax return. Instead, you will see the amounts populate your 2022 return, when you enter that 1099-SA that you are going to receive in early 2023.

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