BillM223
Expert Alumni

Deductions & credits

I don't understand, did you have an excess contribution of $700 or $4,000? If the excess was $700, why did you withdraw $4,000?

 

The HSA is not a savings account from which you can willy-nilly withdraw money. This is the cause of the HSA custodian's reluctance to send you the 1099-SA. because withdrawing random amounts of money from your HSA can be subject to taxations and penalties.

 

If the amount is actually excess contributions, then that follows a different process in the HSA custodian's paperwork, and not only does it not cause a penalty but it also generates a 1099-SA.

 

So come back and tell us about this $4,000/$700 and we'll work out what to do.

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