First, the excess contribution carryover from 2021 to 2022, is carried over again to 2023. This will keep happening forever until you get rid of it.
You get rid of it in one of two ways:
1. You go back under HDHP coverage and then treat the 194 as a personal contribution, so that it will be used up in that year.
2. You ask the HSA custodian to distribute $194 to you, and you report on the 1099-SA interview that this was not for qualified medical expenses, so this will be added to Other Income and penalized 20%.
"When I go to Review and Turbo tax finds an error on 8889 - no entry for line 1" - This is because the Review is confused, on why you have an 8889 when you don't have any HDHP coverage. Of course, your situation is a perfect example of how this can happen but this is on a long lists of enhancement requests.
In your case, because you said that you had NO coverage, then in the Review, you can safely answer Self to the line 1 question, because TurboTax already knows that you had no coverage, and this will get you past the Review problem.
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