My spouse and I both have separate high deductible health plans through our employer and have separate HSA accounts. My employer contributed $6750, to my HSA account over the individual maximum by $2900; same thing happened last year, it was $3100 over, and I just kind of ignored it and paid the extra tax and penalty thinking it would go away but now it is being carried over by TurboTax so I am trying to figure out what to do to solve this.
My spouse's, employer only contributes $400 to their HSA and they contributed nothing extra last year.
First, I was wondering if I can take my excess out and just transfer it to my spouse's HSA account and not pay any extra tax or penalty?
But then I found this on TurboTax help which confused me further:
- Spouses on separate plans: The $7,750 family limit applies to married couples even if one spouse is covered by a family plan and the other spouse has their own individual plan. In this scenario, the couple may split their contributions any way they like, as long as the couple's total contribution doesn't exceed $7,750. Spouses 55 or older at the end of 2023 are allowed to contribute an additional $1,000 to their own HSA.
Our total contribution (from our employers - none by ourselves) is $7150 which is below $7750 - so between the 2 of us this limit has not been exceeded but the turbo tax software is treating us only as individuals - is this because employer contributions are treated differently than self-contributions? Am I misinterpreting this blurb on the TurboTax help? Or is there an error in TurboTax or in the way I'm entering things?
Best case for me would be if it's a TurboTax error - but if there is not an error in TurboTax and I have these excess employer contributions, what is the best way to handle this going forward: transfer to my spouses account if allowed, just take it out and pay tax on it, or spend it to the best of my ability on qualified expenses? I wouldn't want to ask my employer to decrease the contribution - it's better to have that extra money and pay the taxes on it than to not get it unless it's against the rules for them to be over contributing or something.
Thanks for the help in advance!!
