At this point, there is nothing you can do to eliminate the 6% penalty for 2017 on the $366. If you will be HSA eligible in 2018, you can apply it as part of your HSA contribution for 2018 to eliminate the penalty for 2018. Otherwise, to eliminate the penalty for 2018 you must obtain a regular taxable distribution from the HSA of $366. If you are under age 65, in addition to the $366 being taxable, it is also subject to a 20% early-distribution penalty. This makes late correction of an excess HSA contribution quite costly.
