Hi,
In 2023, my employer and I contributed $4850 into my HSA plan through payroll deductions (subtracted from W2 box 1, reported in box 12 code W), and I withdrew $370 in 2023 of excess contribution (1099 SA code 2). The reason I did this is, I was on an individual HDHP for 10 months and family Nov - Dec; the last month rule would qualify us for $7750 in contributions (when the pro-rated limit should actually be $4520), however we are not getting a HDHP in 2024, and so we would like to avoid the penalty for the 12-month period when we file taxes next year.
I filled the TurboTax questionnaire correctly for my 1099-SA, however it is not adding this $370 to my income anywhere. Do I need to separately report the $370 somewhere? Either in other income or in form 8889? Or do I wait until next year to report the $370? (will it incur a penalty for the last-month rule violation?)
