TurboTax should not be adding your distribution as a contribution. Was the 1099-SA for a distribution used on qualified medical expenses with a distribution code of 1? If so, enter it this way:
- Go to Federal > Wages & Income > Less Common Income > 1099-SA, HSA, MSA and click Start/Revisit.
- Make sure you have HSA selected.
- Enter your withdrawals from your HSA by answering Yes to Did you use your HSA to pay for anything in 2021?
- Enter your 1099-SA
- Answer Did you spend your HSA money on medical expenses only?
When asked about your contributions to your HSA, the employer amount from Box 12 of your W-2 will already be in there. Do not enter any additional contributions unless you made them out-of-pocket. If you had any other contributions, like a rollover from a retirement account, that will count against your contribution limit.
