My partner previously had healthcare through the VA, but enrolled with his employer when he became eligible to in May 2017.
The plan through his work is a HDHP plan and he set up an HSA during enrollment (his employer makes contributions to the HSA).
The VA Health 1095-B still states he was covered for the entire year.
While doing taxes, TurboTax stated:
"Tell us what type of HDHP coverage you had for each month of 2017 [...] If you are covered by a HDHP andMedicare or another non-HDHP plan during the same month, select None."
Which leads me to believe that because the VA 1095-B states he was covered by the VA all year, he has to say he had NO HDHP coverage all year.
When we fill out the tax information using his employer coverage (which is HDHP), it takes about $450 off of his taxes due amount.
When we fill out the tax information saying that he had NO HDHP coverage all year (due to having VA Coverage in addition to the HDHP), he still owes almost $500 in taxes.
He hasn't used the VA coverage since he was eligible to enroll in his employer's plan. He didn't even know he could disenroll from the VA coverage.
Why would they penalise a veteran for having VA coverage?
Furthermore, while trying to google info on this to figure out what is the right course of action, I came across something that implies he shouldn't even have the HSA and will have penalties because of it.
"To have an HSA, you can only have had and HDHP plan when you started to make contributions to the HSA. If this was not the case (you still had VA insurance at the same time you had the HDHP), then you will want to contact your plan administrator of your HSA and request and excessive contribution withdrawal or you will pay penalties on your tax return for a disallowed contribution to your HSA." Source
Any help is appreciated.
