Thanks for your prompt reply. So thanks for clarifying the IRS rules with Pub 17. Daughter is definitely a dependent per Table 3-1 p 27 for. 2023 tax purposes. Sounds like she should not have participated in the HDHP for tax purposes. We did include the amount she wrongly contributed on Schedule 1 Line 8f (Income from Form 8889) so she paid taxes back on it as it was pre-tax dollars. So even with checking the box "No, I did not have HDHP coverage for 2023", and also answering Self Only on Form 8889-T Line 1, it had not checked any of the None boxes for us for the year so we selected those for all 12 months to clear the Error. Also, we had to correct the 8889-T form, as somehow through our own entry of amount she contributed to HSA and what was on W2, it had double the amount. It would have been nice to avoid this form altogether with all the confusion yet seems necessary with filing.
Also, with us changing answers in the interview on this, an additional 8889-S form kept being added. This was easy enough to delete with no entries actually on the form. Next tax year 2024 will be easier with the HSA as at 25 and living entire year on her own, she will claim herself as dependent and properly contribute to HSA pre-tax with participation in HDHP.
