If the employer contributed money, then you must fill out form 8889. If your spouse was not enrolled in an HDHP, then the contributions are considered excess, and they are subject to income tax, plus a 6% penalty. That is all reported on form 8889 and you must include it with your tax return. Now that the money is in the account, you are allowed to spend it, and as long as you spend it for qualified medical expenses, the withdrawals are tax free.
If you applied for an extension of the deadline to file your tax return, and your tax return is not overdue, do you have the option of contacting the HSA plan and requesting a “withdrawal of excess contributions.“ This is not a normal withdrawal, it is a special procedure. If you withdraw the excess contributions before the filing deadline, you will still pay income tax on them, but you will not pay the 6% penalty.
