***seco***
"Turbotax shows penalty for excess contribution to HSA even though I didn't go over the IRS limits for HSA.
The penalty comes from your $432 penalty for making excess contributions to a Health Savings Account.
I've checked my HSA and my contributions are:
Amount contributed $7,200.00
Employer contribution $1,500.00
Your contribution $5,700.00
Family limit $7,300.00
Amount left $100.00"
I just created a test return, and entered this exact data, and did not receive any messages about excess contributions.
However, in rereading your post, I noticed "Amount left $100". This is not something that TurboTax would say; however, it is the sort of thing that your HSA custodian might print on their website. Is it possible that all this text in the Courier font came from your HSA custodian?
***j33bell***
"Didn't enter anything wrong."
How do you know? Do you still have a problem?
***mpgerman***
I confused the initial post about excess contributions with your later post about having to claim that you both had to mark that you had HSAs.
In your case, I said, ""It actually asked if there was a reason I was not covered " is a message that comes out of the Income and Additional Tax for Failure to Maintain HDHP Coverage section (line 18) on form 8889 - this has nothing to do with excess contributions. It comes from the question, "What type of High Deductible Health Plan did [name] have on December 1, 2021 (yes, 2021)?" In your case, since you did not go yourself through the HSA interview, TurboTax thought that your HDHP coverage had lapsed when you answered Family or Self to this question.
It's not obvious (I agree) that in your case, you should have answered NONE. Just answering NONE will save you the workaround in future years."
My response about 99.99999% of the time the data was entered in error by the taxpayer was in reference to the original post about excess contributions - excess contributions are almost always caused by the user.
However, your concern is about something that is quite different. Your concern is about finding yourself in Part III of the 8889 "Additional Tax for Failure to Maintain HDHP Coverage" - line 18. I agree it is not obvious that the question that trips you up ("What type of High Deductible Health Plan did [name] have on December 1, 2021?") does not apply to most taxpayers. Thus when you answer the question with Family or Self, you trigger the last-month rule processing, and you are routed through an interview of totally different questions.
Yes, your workaround does work, but it will be simpler to just answer "NONE" to that question.
***zw76890***
I just created a test return with your data, and there was no excess.
From your description, the most likely explanation is that you entered that you were covered by a Self-only HDHP policy, not a Family HDHP policy. I imagine that you think that this is unlikely, but this is exactly how the program would react if you did so.
Would you please recheck the screen where you indicate that you were covered by a Family policy for every month?
***********
Please do not piggy back onto other posts when you have something to ask. That is, please do not assume that your issue is the same as someone else's, but make a new and fresh post.
@seco
@zw76890
@j33bell
@mpgerman
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