The $860 Excess contribution for 2021 was withdrawn in July 2022 after the tax deadline. At the same time I withdrew the $4250 excess contribution for 2022 prior to the 2023 tax deadline. I contacted the financial administrator and he stated that both amounts should appear on a 2099 -SA form showing me the total of 5110. Even if the $860 did not appear on the 1099 –SA form, TurboTax still knows about the 2021 excess contribution. This is because the amount I was eligible to contribute in 2021 was less than what I actually contributed based on the W-2 form . This was directly related to the fact that I had Medicare coverage the last three months of 2021 and was not allowed to contribute to an HSA but was contributing anyway. Even though TurboTax is aware that the excess contribution of 860 has been withdrawn based on the existing 1099 -SA form, it will not allow it because the withdrawing took place after the 2021 tax deadline. Therefore TurboTax carried the 6% penalty over to 2022 and it’s showing it on my current tax filing.
TurboTax is suggesting that I make another withdrawal from my HSA in the amount of $860 as a non-qualified distribution. It states I’ll be charged 20% tax on it but that should resolve the issue. I’d rather not do that because I’ve already withdrawn the $860 and paid income tax plus the 6% penalty. but if that’s what needs to be done, I may have no choice.
again, what options do I have to resolve this?
