Thank you for your feedback much appreciated. A few follow up clarification questions relating to this part of feedback, "These contributions will need to be marked as Other income be taxed" - please do NOT do anything about this. Once you have done the HSA interview, indicating that you did not have valid HDHP coverage for those months you were covered by the FSA, TurboTax will automatically add the excess contributions back to income. Please don't try to help TurboTax.
1.) If FSA started in July 2023 for Spouse and I had HSA for all of 2023 under HDHP Family Plan would January thru June be considered as having valid HDHP coverage and then July thru December as not having valid HDHP due to having HSA and FSA active at same time?
I followed steps in HSA interview as mentioned in posts (very helpful). But later on Turbo Tax mentioned there were errors on Tax Form 8889-T and it asked to provide a checkbox for each month in 2023 that had HDHP plan.
2.) If HDHP plan is valid between January thru June? Would the the excess or invalid contributions in HSA only be what was contributed between July through December?
Just want to make sure I do not have to ask for contributions in 2023 to be refunded. Also if July through December then can request only those amount contributed during that time frame.
3.) HSA and FSA limits were not exceeded during 2023, but as understand the interaction by having them open at same the makes the contributions invalid and thus have to be refunded/withdrawn by deadline for Tax return April 2024 to avoid 6% penalty.
